Japanese officials have stepped up verbal warnings - BBH

Research Team at BBH, notes that the Japanese officials have stepped up their verbal warnings to the market but with little effect as it is widely understood that officials have limited room to maneuver.

Key Quotes

“The bar to intervention is high. The G7 and G20 recently have reiterated their pledge (what we have cast as a type of arms control agreement) not to seek competitive advantage from the currency market. Prime Minister Abe himself reiterated this in an interview with Dow Jones this week.

It has been five years since there was intervention on dollar-yen, and that was in coordinated action following the tsunami and earthquake in Japan. Although the pace of the move is strong, and the move has been one-way, the market is not disorderly. We note that the current five days advancing streak of the yen follows a seven-session run to the downside between March 17 and March 28.”