02 August 2016 at 2:23 GMT
Former Japanese vice finance minister Eisuke Sakakibara said the yen could strengthen toward 90 per dollar as soon as this month and provoke officials to sell the currency to weaken it. Japan’s currency will appreciate gradually toward 100 per dollar, but gains are likely to accelerate beyond that level, said the 75-year-old, who was dubbed “Mr. Yen” for his ability to influence the exchange rate in the 1990s. Sakakibara sees the “intervention zone” lying between 90-95, when dollar weakness should worry the US Treasury Department enough to agree to yen selling by the Finance Ministry, which he sees as a precondition for the intervention to be effective. “It’s very likely that the yen will break 100 this year, or even this month,” Sakakibara said in an interview in Tokyo on Monday. “If it breaks 100, it could head for 90 quite quickly. Then it becomes a question of if they intervene.” Japan intervened in currency markets three times in 2011, selling 14.3 trillion yen ($140 billion).
Read full article at Bloomberg