The Japanese yen dropped to a 32-year low against the US dollar after official figures indicated the inflation to increase much more than expected in the US.
The yen fell to 147.66 before making a short comeback. Japanese Finance Minister Shunichi Suzuki vowed to take “appropriate action” against the currency’s volatility.
Last month, Japan was prompted to make its first intervention in the currency market since 1998 after yen reached a 24-year low.
However, experts have warned that such interventions would not be much effective as long as the interest rates in Japan remain far lower than those in the US. The Japanese currency has come under increasing pressure in the recent months, mainly due to the very different approach adopted by the central bank of Japan as compared to the US Federal Reserve.
