After correctly predicting the yen's relentless march beyond ¥115, ¥110 and ¥105, former Finance Ministry official Eisuke Sakakibara now says the Japanese currency will gradually strengthen more than 4 percent toward ¥100 per dollar by the end of the year.
The currency's value reflects the difference between monetary policy in the U.S. and Japan, Sakakibara, known as Mr. Yen for his ability to influence the exchange rate in the late 1990s, said in a Bloomberg Television interview Monday. The impact of the Bank of Japan's aggressive monetary easing is tapering off, adding to the yen's appreciation, he said.
"If it breaks ¥100, Bank of Japan intervention is possible, but in order to intervene in the markets, you have to get agreement from the United States, and at this level — ¥104, ¥105 — I don't think the U.S. would agree," Sakakibara, 75, said. "But if it breaks ¥100 and heads toward ¥90, it is possible that the U.S. authorities and Japanese authorities agree on the Japanese intervention."