TOKYO - Japan will respond as needed to "extremely nervous" exchange-rate moves in the wake of Britain's referendum on leaving the European Union, Finance Minister Taro Aso said on Friday, signalling a readiness to intervene to stem excessive yen strength.
Aso declined to comment when asked about the possibility of coordinated intervention in currency markets, or whether Japan had intervened to stem the yen's strength, as the Japanese currency soared above 100 to the dollar due its safe haven status, with voting trends showing Britain was likely to leave.
"I'm extremely concerned about the risk (Brexit) has on the global economy, financial and currency markets. It is extremely important to ensure growth in the global economy, as well as maintaining currency and financial stability," Aso told reporters.
"Current exchange-rate markets are showing extremely nervous movements. In order to prevent such moves from continuing, I'll closely watch currency market moves more than ever with a sense of urgency and will respond firmly when necessary," he said.
Bank of Japan Governor Haruhiko Kuroda also issued a statement on Friday saying that the BOJ stands ready to provide ample liquidity to financial markets, including by using existing swap arrangements with other central banks.
Japan's policymakers are worried a Brexit vote could boost demand for the safe-haven yen and trigger an unwelcome rise in the Japanese currency that would hurt Japan's exports, and drive the economy back toward recession.