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[TOKYO] Japan's finance minister criticized China's recent intervention in financial markets, after the yen surged the most since 1998 amid a deepening sell-off in global stocks.
"It's not really the kind of action I would expect from authorities of a nation that aims to have an international currency," Finance Minister Taro Aso told reporters in Tokyo on Tuesday. "There's concern in the market because what's happened goes against common sense vis-a-vis international currencies," he said, referring to halting trading in stocks and intervening in the currency market.
A slump in stocks and commodities has accelerated since China devalued its currency two weeks ago. For Japan, the yen's surge could counter efforts to keep the economy on a recovery from two decades of stagnation.
"Rather than abrupt, I'd describe it as rough," Mr Aso said in reference to the yen's jump overnight.
Economy Minister Akira Amari said that the yen was bought as a safe asset, reflecting the evaluation of Japan's economy as being "sound." The yen was trading at 120.04 per dollar at 12.50 pm in Tokyo, after surging as high as 116.18 overnight, marking the biggest gain since October 1998. The Japanese currency has still lost 22 per cent since the Bank of Japan introduced record monetary easing in April 2013.
Mr Aso said the officials from the Group of Seven and G-20 nations weren't at the stage of making a joint response to the moves in exchange rates and stock markets, but that they have been keeping in frequent contact.
He also said he isn't considering any measures to boost the economy, which has been been hurt by falling consumer sentiment, a buildup in inventories held by companies and sagging exports.
Prime Minister Shinzo Abe on Monday acknowledged that the Bank of Japan's 2 per cent inflation target is getting harder to achieve as tumbling oil prices dull the effects of its record monetary stimulus.