EXCLUSIVE-FX moves too fast, too speculative-Japan's Sengoku

Published 10/02/2010, 04:08 AM
Updated 10/02/2010, 04:12 AM

TOKYO, Oct 2 (Reuters) - Recent currency market moves are too speculative and the yen is becoming too strong, too fast, causing serious damage to Japan's economy, Japanese Chief Cabinet Secretary Yoshito Sengoku said on Saturday.

Japanese authorities, worried that the yen's rise would derail an export-driven recovery, intervened in the currency market on Sept. 15 for the first time in over six years after the yen jumped to a 15-year high against the dollar.

The dollar traded at about 83.25 yen in New York on Friday, edging closer to a 15-year low of 82.87 yen hit last month. Traders say a fall below that level may trigger intervention.

"The appropriate level is something basically to be decided by the market. But it should not be decided by speculative moves, but reflect the real economy," Sengoku, the de facto No. 2 in Prime Minister Naoto Kan's cabinet told Reuters in an interview.

"If the exchange rate is one that settles down gradually, we would not reject that. But I think that the current moves are too speculative and as a result the yen is rapidly becoming too strong," he said.

Sengoku refrained from saying whether Japan would intervene again, but said that authorities could take "appropriate action at the appropriate time." (Reporting by Linda Sieg and Yuko Yoshikawa, editing by Jonathan Thatcher)

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