Japan’s Finance Minister, Hirohisa Fujii, said today that the government is “very closely” watching the yen after the currency rose to a 14-year high against the dollar. An appreciating yen is especially worrisome to Japan’s government as Japan is heavily dependant on its exports and any increase in the value of the yen, raises the costs of its exports. A higher valued yen simultaneously increases deflationay pressure on Japan’s ecoonomy by making imports less costly for consumers.
“If currencies make abnormal movements, we may need to take appropriate action,†Fujii told reporters in Tokyo today. “Now we’re at the stage where we need to closely monitor movements in currency markets.â€
