‘Mr. Yen’ says the currency could plunge further — and 170 per dollar is ‘well on the scope’

A dealer reacts in the trading room at foreign exchange brokerage Gaitame.Com Co. in Tokyo on Oct. 21, 2022. The yen’s slump past the symbolic mark of 150 per dollar is keeping traders guessing when Japanese authorities will intervene to halt a further decline.

The Japanese currency could weaken further against the U.S. dollar next year according to a former vice minister of finance.

He said he expects the currency to depreciate further as it is near its weakest level in 32 years.

Most of the business people are expecting further depreciation of the Japanese currency. Speaking on CNBC, 170 said it was in the scope.

Japanese officials have not publicly confirmed that they spent a record amount of money to defend the currency in September. Within a month, the currency will be able to break a psychological level of 150.

As Japanese officials remain tight-mouthed about a second intervention taking place to defend the currency, Sakakibara has a forecast for the yen.

There is a chart.

Line chart with 4293 data points.The chart has 1 X axis displaying Time. Range: 2022-10-20 01:48:00 to 2022-10-25 01:47:00.The chart has 1 Y axis displaying values. Range: 144 to 154.End of interactive chart.

The finance minister said that the central bank's easing of monetary policy and intervention in the foreign exchange market were not in contradiction.

Suzuki said that monetary easing aimed at sustainable and stable price hikes including wage growth, and currency intervention in response to excessive market moves are different from policy objectives.

The nation's dovish monetary policy is expected to stay the same in the next meeting.

The Bank of Japan will likely keep its stance until the second half of the century, according to 25 of 28 economists.

The Bank of Japan is expected to start raising interest rates sometime later next year, once the central bank governor's term ends in April 2023.

The monetary policy of the Bank of Japan could be changed if the Japanese economy gets overheated. One or two rate hikes could come in the form of one or two policy shifts.

If there is an overheating of the economy, the Bank of Japan will likely raise interest rates.

It won't have much of an effect if authorities continue to intervene.

He said that intervention is not effective.

Japanese authorities are aware of the limited impact of intervention in the foreign exchange market.

The Bank of Japan and the Ministry of Finance have a history of failed interventions, according to the firm's managing director of foreign exchange strategy.

When the intervention efforts were combined with other G-7 nations, it worked.

The Bank of Japan is scheduled to meet next week and a rate hike would be more effective in defending the Japanese currency.

Raising interest rates is what they need to do. It is testing the quarter-percent 10-year yields cap because of the weakness of the Japanese currency.

They are running out of options at the moment. Policymakers don't think it's a good idea to support the currency.