Yentervention Part 2011: Dollar Yen Surges After Ministry Of Finance Sells Just Under Y500 Billion

Tyler Durden's picture

First the SNB earlier today, now the BOJ? Out of nowhere the USDJPY just surged by 100 pips. It appears that the next round of central bank warfare is upon us.

And from Bloomberg:

  • Japan Intervened in Yen, Nikkei Says
  • Japan Intervened to Sell Yen, Finance Minister Noda Says
  • Yen Falls as Much as 1.8% to 78.43 Per Dollar After Intervention
  • Japan’s Intervention Was Unilateral, Finance Minister Noda Says
  • MOF sold under Y500 billion in intervention: 2 dealers
  • Noda Says He Hopes Bank of Japan Will Take Appropriate Actions

There, it wasn't that painful now was it. Now just prepare to do it over, and over, and over, because as the SNB showed earlier, the last recourse of central banking around the world now has a 6 hour halflife.

And since this a short 11 month period from the last time the BOJ intervened and failed, here is to old memories and failed central bank interventions.

From Currency Intervention, Bitches, September 14, 2010

After a six year wait, the BoJ has finally had enough of the Federal Reserve's endless manipulation and has itself intervened in the currency market. The USDJPY jumps over 150 bps, the Nikkei surges 250 pts (that ES-Nikkei convergence or whatever the hell it was is closing soon) as the BOJ sells between 200 and 300 billion worth of yen. Yes, this is the time to short, short, short because if the now useless SNB interventions have taught is anything it is that central banks are populated by pompous morons who believe they can control the world, when the best thing they can do is hope for the last Viagra shot to result in priapism. For those who have taken Psych 101 - look up learned helplessnes. Next up - the SNB, and after that the Fed once again, and after that, the slow but sure end of fiat. The race to the currency devaluation bottom is now in the third and last lap. And incidentally, for all those who missed it, the BOJ's intervention is a symbolic capitulation,  and the beginning of the end for the Keynesian system. Rejoice.

 

And Reuters' recap:

Finance Minister Yoshihiko Noda said Japan acted on its own and aimed to stem speculative and disorderly currency moves.

 

Noda told a news conference he expected the Bank of Japan to take appropriate action. He declined to comment on the size of the intervention or say what currencies Japan bought.

The central bank, which started its policy meeting on Thursday would announce its policy decisions later in the day.

The action that followed days of official warnings that the currency, largely driven by broad dollar weakness, has passed levels that the export-reliant economy could live with, pushed the yen down to about 78.30 to the dollar from a level of around 77.

Some currency traders braced for further dollar declines should U.S. payroll data on Friday heighten concerns about the health of the U.S. economy. That could increase the chance of Japanese government intervention and make it more likely that the Bank of Japan will ease policy at a meeting ending on Friday.

Suzuki Motor Corp (7269.T) executive vice president Toshihiro Suzuki said on Wednesday it was "very sad" that no one was taking action against the strong yen, adding to a chorus of Japanese business leaders calling for action to weaken the currency.

Japan last intervened in concert with the Group of Seven in March, when expectations of fund repatriation after the earthquake pushed the yen to a record high.