G7 to protect yen with market intervention
Finance ministers and central bank governors from the G7 countries have agreed to intervene in currency markets to reduce the yen’s volatility.
This week saw the yen climb to its highest ever level against the dollar as Japan struggles to cope with the aftermath of the recent earthquake and tsunami, in addition to the ongoing crisis at the Fukushima nuclear plant.
Britain, America, Canada and the European Central Bank say they will join Japan in a “concerted intervention in exchange markets” today to prevent a strong currency from hampering the country’s recovery.
The G7, which is intervening at Japan’s request, adds that it will continue to monitor exchange markets and “cooperate as appropriate”.
“We express our solidarity with the Japanese people in these difficult times, our readiness to provide any needed cooperation and our confidence in the resilience of the Japanese economy and financial sector,” a statement from the group reads.
The Bank of Japan adds it will “pursue powerful monetary easing and, to ensure stability in financial markets, will continue to provide ample liquidity” in its bid to reduce volatility in the yen.
The bank has already injected ¥37 trillion (£280 billion) into the markets to stabilise the currency.
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