Why the US intervention on the Japanese yen could ripple into Argentina
The move came after the Japanese currency hit its lowest point in 40 years. Experts don't rule out further action La entrada Why the US intervention on the Japanese yen could ripple into Argentina se publicó primero en Buenos Aires Herald .
The US intervened with Japan on the Japanese yen to prevent it from falling too low, which could have ripple effects in Argentina. Washington and Japan coordinated to buy massive amounts of yen, pushing up its value and putting pressure on the Japanese stock market. Finance Minister Satsuki Katayama said they would not hesitate to do more of the same. The yen jumped more than 1% after the announcement, to 155.20 per dollar, its highest level since early May. It currently trades at 156.66 per dollar.
The Japanese government sold US$70-80 billion worth of US Treasuries over the last three days to keep their currency from depreciating further. Analyst Gastón Lentini explained that Japan has been selling US Treasuries to defend the yen for years, and the yen carry trade has been a widely used source of financing for global financial markets. If the Bank of Japan raises interest rates, it could limit global liquidity and hit risk assets and emerging markets like Argentina's first.
Written by urgent.news from Buenos Aires Herald's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
