Japan should ask the U.S. and Europe to take coordinated action to weaken the yen, Financial Services Minister Shizuka Kamei said.

“We need international coordination,” Kamei, 73, said in an interview in Tokyo Wednesday. Asked what action he had in mind, Kamei said Japan should “call for international intervention” in the currency markets.
Kamei, whose People’s New Party is a coalition partner to the Democratic Party of Japan, said he had urged Finance Minister Hirohisa Fujii to seek international cooperation to halt the currency’s rise.
The yen climbed to 84.83 per dollar on Nov. 27, the highest since July 1995. It has risen 3.5 percent in the past month, threatening to erode profits of exporters including Sony Corp. and Toyota Motor Corp. and exacerbate deflation as the nation recovers from its worst postwar recession.
The yen traded at 87.25 to the dollar as of 5:30 p.m. in Tokyo.
Fujii said on Nov. 27 he would “establish contact” with his counterparts overseas and seek help in weakening the yen if necessary. The last time Japan conducted coordinated intervention with other Group of Seven nations was Sept. 22, 2000, when action was taken to support the euro.
Japan hasn’t sold its currency since March 16, 2004, when the yen was around 109 per dollar. The Bank of Japan sold 14.8 trillion yen in the first three months of 2004.
‘Waste paper’
“Japan has lent the U.S. about 200 trillion yen ($2.3 trillion), and that could become waste paper,” Kamei said. “It’s not just currencies. Each country has to take economic stimulus steps too.”
Kamei has a history of controversial stances. Then-premier Junichiro Koizumi kicked him out of the Liberal Democratic Party in 2005 for opposing a plan to privatize the postal system. Kamei immediately formed his own party.
Kamei said his party, which holds eight of the 722 seats in Japan’s parliament, is leading the government in discussions about fiscal policy.
Prime Minister Yukio Hatoyama’s government is compiling an extra budget reportedly worth as much as 4 trillion yen in new spending. Kamei said Hatoyama is “moving closer” to his stance that stimulus spending should total 11 trillion yen.
(Source: Bloomberg)