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BOJ Yentervention Cost: ¥692.5 Billion

Tyler Durden's picture




 

For those wondering how much the latest intervention in the Yen cost to the BOJ, we now have our answer. According to the Japanese Ministry of Finance, Japanese authorities intervened in the foreign exchange markets to the tune of Y692.5 billion in March. Market News elaborates: " The data from MOF confirmed that the Japanese authorities intervened in the markets from March 18, although MOF did not confirm the actual dates the Bank of Japan intervened on its behalf. However, Japan Finance Minister Yoshihiko Noda had already announced intervention had started on that Friday."

The yen-selling intervention was part of a co-ordinated move by the Group of Seven industrialized nations, acting in concert to aid Japan in the wake of the March 11 Tohoku-Pacific Ocean Earthquake and tsunami.

The move was triggered as the dollar-yen exchange rate fell to an all-time low at Y76.25. The pair rebounded to Y81.75 as the Bank of Japan started the intervention.

In a statement, the G7 said "excess volatility and disorderly movements in exchange rates have adverse implications for economic and financial stability. We will monitor exchange markets closely and will cooperate as appropriate."

The intervention in the currency markets was the first such action by the Japanese authorities since September 2010. It was the first co-ordinated intervention by the G7 nations since 2002.

And now we know what 300 pips cost in real money. For now, the intervention is working.

 

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Thu, 03/31/2011 - 09:48 | 1121102 pendragon
pendragon's picture

the boj are obsessive compulsives. surely there are more pressing matters at hand than their currency? japan really is a country in steep decline

Thu, 03/31/2011 - 09:53 | 1121127 kaiserhoff
kaiserhoff's picture

+ if not free fall.

Thu, 03/31/2011 - 09:58 | 1121140 flacon
flacon's picture

Seven hundred billion seems to be a recurring magic number these past few years, eh? Thank you Neel Kashkari. 

Thu, 03/31/2011 - 09:51 | 1121114 AC_Doctor
AC_Doctor's picture

The drowning has commenced...

Thu, 03/31/2011 - 09:52 | 1121118 rubearish10
rubearish10's picture

Does anyone still expect asset sales and repatriation?? There's no panic.

Thu, 03/31/2011 - 09:50 | 1121119 kaiserhoff
kaiserhoff's picture

The MSM retards are quoting cost to Japan of the various disasters at $300 billion.  Right, try one third of their island, and knocking their economy back to par with the Philippines.  That may not be correct, but it's a lot closer to the truth.

Thu, 03/31/2011 - 09:51 | 1121120 pendragon
pendragon's picture

they were waiting for any excuse. the meltdown gave them the perfect cover

Thu, 03/31/2011 - 09:57 | 1121131 TruthInSunshine
TruthInSunshine's picture

Japan is the 3rd largest global economy and largest exporter in history. The risks to the global economy here can't be understated.

Japan is about to be printed into the twilight zone. Aggressive BOJ intervention will be required for an incredibly long time to keep the Nikkei from crashing.

BOJ has no other choice, truly; print or see everything crash.

Laugh if you must, agree if you will, but USD will buy 130 Yen again, soon.

The economic crisis has now started in Japan and will be felt first and foremost in China, as they are reliant on durable good production that utilizes many Japanese sourced (and proprietary) components.

Everything in the global economy, with a few notable exceptions, for the past two years was the result of monetary sugar from aggressive central bank monetary policy and stimulative governmental actions.

Both were developed to kick the can so as to allow some organic growth to eventually take off and take over from very expensive and inefficient monetary policy.

The organic growth never kicked in. And this Japan crisis just took all remaining air out of its chances to do so.

Thu, 03/31/2011 - 10:06 | 1121162 Sandy15
Sandy15's picture

Everything you say is 100% correct.  The leftist economist need to wake up to the fact, or maybe they have, but tell the TRUTH on the fact.

 

The Bernack nor other central Bankers were figuring on a natural disaster.

Thu, 03/31/2011 - 10:18 | 1121205 kaiserhoff
kaiserhoff's picture

Agree with almost everything.  China gets burned big time, but they don't know it yet.  Not two years, but twenty two.  It was 1989 when the Japanese market crashed, the interest rate was cut to 1%, and the carry trade began.  Markets haven't really been right since.

Thu, 03/31/2011 - 10:00 | 1121142 RobotTrader
RobotTrader's picture

Every problem can now be solved by turning on the printing press and spewing forth trillions of electronic digits.

The Bernanke has turned out to be a financial market hero.

Everyone will be copying him from now on.

Thu, 03/31/2011 - 10:03 | 1121156 tmosley
tmosley's picture

I've got some radioactive milk that says otherwise.

Printing works until it has devoured ALL capital in the system, at which point NOTHING will work, and Japan and others will find themselves in the first world one day, only to wake up in the third world the next.

For those keeping track, that is the day you don't want to be in stocks.

Thu, 03/31/2011 - 11:19 | 1121448 Ethics Gradient
Ethics Gradient's picture

I think you'll find RobotTrader is a robot what does trading.

It merely sees what it is programmed to see in order to trade and make money on the day. Common sense wasn't programmed in, however some comedian programmed in a posting subroutine and gave it a ZH account.

I find RT an interesting counterpoint. That said, it was even more interesting when it had a habit of posting random pictures of pretty laidies. Although I'm told there are other places on the electric interweb to find that sort of thing.

Thu, 03/31/2011 - 10:00 | 1121150 Hedgetard55
Hedgetard55's picture

That's only $8 Billion or so. Chump change says Ben.

Thu, 03/31/2011 - 10:05 | 1121163 plongka10
plongka10's picture

Exactly. I thought it was a lot more than that.

Thu, 03/31/2011 - 10:20 | 1121210 Hansel
Hansel's picture

Does not compute. From this Reuters article on March 15,

"The BOJ on Tuesday offered to pump 8 trillion yen ($98 billion) into the banking system, continuing its huge fund injection aimed at easing market jitters in the face escalating nuclear crisis and fears of unprecedented damage from the earthquake.

The auction, which follows a record 15 trillion yen the BOJ offered in same-day market operations on Monday, drew bids of 5.4 trillion yen."

Maybe "intervention" and "offered to pump" are different?

Thu, 03/31/2011 - 15:11 | 1122455 Kobe Beef
Kobe Beef's picture

That's still a lot of money for one month.

Thu, 03/31/2011 - 10:06 | 1121169 HedgeFundLIVE
Thu, 03/31/2011 - 10:41 | 1121291 RockyRacoon
RockyRacoon's picture

Interesting work to be sure.

" You have to be aware of the overall market trend, economic conditions, global events, market sentiment."

That would be correct, of course, but I think I'd rather get some tomato plants set out, follow up on the training for my new pups, find another hidey-hole for the latest silver purchases, go to the rifle range and wring out the sight for my Mini-14, take the wife to Sam's for some staples, and perhaps take some time to read that Heinlein novel I've put off.   Cheerio.

I am free because I know that I alone am morally responsible for everything I do. I am free, no matter what rules surround me. If I find them tolerable, I tolerate them; if I find them too obnoxious, I break them. I am free because I know that I alone am morally responsible for everything I do.

Thu, 03/31/2011 - 11:04 | 1121401 kaiserhoff
kaiserhoff's picture

Great quote Rocky.  Ayn Rand?

Fri, 04/01/2011 - 00:52 | 1124145 RockyRacoon
RockyRacoon's picture

Robert A. Heinlein

 

The Moon Is a Harsh Mistress
Thu, 03/31/2011 - 10:20 | 1121204 Urban Redneck
Urban Redneck's picture

BOJ is only one of the G7 CBs that agreed to intervention.  I would like to know what the enitre tab was.  

Thu, 03/31/2011 - 10:59 | 1121377 Ari Gold
Ari Gold's picture

Given this number, I would imagine there is still a large amount of carry left to unwind - but we do need the entire G7 number as stated by the poster above

Thu, 03/31/2011 - 12:12 | 1121686 Eddie Stobart
Eddie Stobart's picture

It's not a lot of money. At 80 yen to the dollar it's 8.65 billion dollars. The US is $10 trillion in debt and the Japanese banks did not indulge in the credit boom.

Why is this even a story?

Thu, 03/31/2011 - 12:22 | 1121718 99er
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