Key insights
- Japan likely spent $32 billion buying Yen, indicated by a large net outflow of funds. This intervention aims to bolster the Yen. While directly impacting USD/JPY, the broader US equity market impact is slightly negative, reflecting potential global currency volatility and uncertainty regarding future BOJ actions.
By Atsuko Aoyama and Rocky Swift
TOKYO, May 7 (Reuters) - Japan may have spent as much as 5.01 trillion yen ($32.06 billion) in its latest efforts to bolster its embattled currency, central bank data indicated on Thursday, signalling repeated bouts of intervention in markets.
The Bank of Japan’s projection for money market conditions for the following day indicated a 4.51 trillion yen net outflow of funds, compared with brokerage forecasts of between zero and an increase of 500 billion yen.
Yen-buying activity involves the BOJ soaking up the currency from markets, so any outsized shortfalls in funds can offer an estimate of the size of any intervention.
($1 = 156.2600 yen)