JPY might receive some protection. Overview for 20.02.2024

The Japanese yen, paired with the US dollar, is constantly changing its trajectory. The current USDJPY exchange rate stands at 150.16.

Today, the market focuses on discussions about currency interventions in Japan. On Tuesday, Finance Ministry spokesman Atsushi Mimura noted that the Japanese authorities are in ongoing dialogue with their foreign counterparts and the Central Bank in case rapid reactions are necessary in the currency market. Investors interpreted this as hints at potential interventions.

Mimura reported that the Bank of Japan and the Ministry of Finance are concerned about maintaining the yen's high levels of safety and liquidity. For the authorities to be able to utilise currency reserves for interventions, these assets are held in bonds and currencies.

In reality, the Bank of Japan is not prepared to intervene, especially considering that current levels are not critical for the yen.