The government and the Bank of Japan intervened in the currency market Thursday to stem the yen's appreciation vs. the dollar, currency traders said.
Japanese monetary authorities apparently stepped into the market at about 10:45 a.m. to sell yen after the dollar fell below 116 yen, the traders said.
"The BOJ intervened sporadically (in currency markets)," said a trader at a foreign bank operating in Tokyo. "With those actions, the BOJ has demonstrated its resolve" to forestall yen strengthening, he said.
Because of the intervention, the dollar began to rebound shortly before 11 a.m. and briefly traded at 116.90 yen, the traders said.
The dollar's slide below 116 yen in Tokyo was the first time it's done so since May 19.
The BOJ was apparently trying to prevent the yen's strength from hurting earnings of export-oriented companies as the domestic economy is showing signs of recovery.