Yen hits record

Townsville Bulletin - - Investor -

JA­PAN pumped more funds into its shaky fi­nan­cial sys­tem af­ter stocks fell and the yen surged to a record high, which Tokyo blamed on cur­rency spec­u­la­tors foll ow­ing t he huge earth­quake.

The cen­tral bank in­jected an­other Y6 tril­lion ($ A79.14 bil­lion), in­creas­ing to Y34 tril­lion ($ A448.46 bil­lion) the to­tal funds added to money mar­kets since Mon­day to soothe jit­ters af­ter l ast week’s dev­as­tat­ing quake and tsunami.

Fi­nance chiefs from the G7 rich na­tions were set to hold tele­phone talks on the cri­sis yes­ter­day, as mar­ket talk grew that Ja­pan might be pre­par­ing mea­sures to rein in the soar­ing yen.

‘ ‘ There i s i nten­si­fy­ing mar­ket s p e c ul a t i o n t he Bank of Ja­pan will soon in­ter­vene to cap sup­port of the yen,’’ said NAB Cap­i­tal an­a­lyst David de Garis.

Deal­ers said some mar­ket play­ers ap­peared to be buy­ing the yen on ex­pec­ta­tions that Ja­panese com­pa­nies would repa­tri­ate funds to pay for re­con­struc­tion.

S u c h s p e c u l a t i o n i s ‘‘ to­tally ground­less’’, said Econ­omy Min­is­ter Kaoru Yosano, adding the yen’s s u r g e w a s ‘ ‘ e x t r e m e l y spec­u­la­tive’’.

French Fi­nance Min­is­ter Christine La­garde, who c a l l e d t h e G 7 t a l k s , sug­gested fi­nan­cial as­sist-

RE­COV­ERY MODE: Ja­pan is look­ing to re­store the value of the yen af­ter the earth­quake ance may be ex­tended.

The In­ter­na­tional Mon­e­tary Fund, how­ever, said Tokyo had not asked for IMF help and had the re­sources to cope with the dis­as­ters.

‘ ‘ We b e l i e v e t h a t t h e Ja­panese econ­omy i s a strong and wealthy so­ci­ety and the gov­ern­ment has the full fi­nan­cial re­sources to ad­dress those needs,’’ IMF s p o k e s wo ma n C a r o l i n e Atkin­son said.

In­vestors wel­comed news t h a t a r m y h e l i c o p t e r s dumped wa­ter on the cri­sishi t Fukushima nucl e a r power plant in a bid to douse ra­dioac­tive fuel rods as part of ef­forts to pre­vent a re­lease of ra­di­a­tion.

Stocks re­cov­ered some of their early losses to end down 1.44 per cent, hav­ing sunk more than four per cent in early deals.

Tokyo’s Nikkei share in­dex suf­fered the big­gest two-day sell-off for 24 years on Mon­day and Tues­day, plung­ing 16 per cent, amid the world’s worst nu­clear cri­sis since Ch­er­nobyl Ukraine in 1986.

The yen struck a record high of 76.52 per US dol­lar in early Asian trade, but later pulled backed, eas­ing wor­ries about the im­pact of a strong cur­rency on ex­ports. The yen was quoted at 78.34 against the green­back in Euro­pean trade.

J a p a n e s e o f f i c i a l s d e - clined to com­ment on the pos­si­bil­ity of in­ter­ven­tion, but their si­lence did nothi n g t o d a mpen marke t spec­u­la­tion.

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