The dollar and yen have moved drastically. After briefly bre...
The dollar and yen have moved drastically. After briefly breaking through 160 yen for the first time in about 34 years on the morning of the 29th Japan time, it was regaining some calm in the first half of the 159 yen range, but it plummeted in the afternoon. The price dropped drastically by about 4 yen to around 155 yen at one point. In terms of price movements, it seems that there was exchange intervention, but on the 29th, Japan was a holiday and sales were weak, and the dollar and yen had risen rapidly until then. Since it was a situation where it was easy to react hypersensitively to consolidated dollar sales and yen purchases, it is currently unclear whether exchange intervention was carried out. There was also a sense of caution against intervention, and short yen positions had accumulated. It is reported that on the 29th, Treasurer Kanda Masato was asked by the press corps about the presence or absence of exchange intervention and said “no comment now” and “work is underway now.” It's meaningful, but I haven't been able to confirm it from the comments either. So, we have no choice but to make estimates and speculations this time as well. Below is one method. Every business day (around 5-6 o'clock in the evening), the Bank of Japan announces the forecast for the day after the Bank of Japan current account balance, which indicates the total amount of cash on hand at financial institutions. Among them, there is an item called “financial factors, etc.,” and since it indicates receipt and payment of financial funds between private financial institutions and the government, this moves drastically when there is exchange intervention. Since the exchange intervention will be settled after 2 days, it will be reflected in the next day's forecast for the Bank of Japan current account balance announced by the Bank of Japan the day after the day the intervention seems to have occurred. Please check the “financial factors” among them. If the presence or absence of intervention on the 29th is to be confirmed, the forecast for 5/1, which will be announced on the evening of tomorrow 30th, will be used as a judgment material. These “financial factors” can be predicted to some extent. This is because tax collection dates etc. are known in advance, and short-term investment companies that are experts in the short-term market have published forecast figures. If there is an intervention, the figures announced by the Bank of Japan deviate greatly from this predicted value, so the difference can be estimated as an intervention amount. In the case of a yen purchase intervention, the numbers fluctuate in the direction of shortage because it is the absorption of funds. For example, if the forecast of a short equity company is insufficient of 300 billion yen, and if the forecast for financial factors etc. in the Bank of Japan current account balance is a shortage of 1 trillion yen, then 70 billion yen, which is the difference, is the scale of intervention. If the short-term capital company's predictions are surplus rather than lacking, please add them up. However, it is not possible to pinpoint the outlook for financial and other factors due to short term capital companies, and there are also differences between companies in the predictions of the three major short-term capital companies. It's just a “guide,” and in the case of a small-scale intervention, it becomes difficult to estimate from the expected divergence between the Bank of Japan and the short term capital company. The official exchange intervention amount (implementation status of foreign exchange equilibrium operations) will be announced by the Ministry of Finance at a later date, but what will be announced by the Ministry of Finance at 7:00 p.m. on 4/30 tomorrow is for 3/28 to 4/25. Whether there was an intervention on the 29th will be announced next month. However, this is also a total cumulative figure for 1 month, so if there is another interventional movement, you won't know if it happened on the 29th, and you will have no choice but to wait for the publication on a daily basis to be announced in early August.
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