Japan official hints at possible market intervention

"There are voices that speculative movements are increasing in the foreign exchange market," Mimura told reporters at the Finance Ministry.

Referring to recent trends in crude oil futures trading, he said, "If this situation continues, it will be necessary to take decisive measures soon," adding, "Our sights are directed in all directions."

It is the first time that Mimura has used the phrase "decisive measures" since he assumed his current position in the summer 2024.

A plan to stem the depreciation of the yen by intervening in the crude oil futures market and curbing speculative trading is being considered by some government officials, informed sources said.

Meanwhile, Bank of Japan Governor Kazuo Ueda told a House of Representatives Budget Committee meeting on Monday that the central bank will "make appropriate monetary policy decisions while monitoring the impact (of the yen's weakening) on the likelihood of meeting its economic and price outlooks."

"Currency fluctuations are more likely to affect prices" than before because companies are increasingly passing on costs in prices, Ueda added.

In Tokyo currency trading on Monday morning, the dollar moved around 160 yen after rising to around 160.45 yen in early morning trading overseas, the highest level since July 11, 2024.

The remarks by Mimura were regarded as a warning against a weak yen, and caution over currency intervention has intensified, an official at a foreign exchange margin trading service firm said.

The dollar was quoted at 159.92-94 yen at 11:00 am Monday, almost unchanged from 159.94-95 yen at 5:00 pm Friday, after standing at 160.21-22 yen at 9:00 am.