market manipulation by government
This article by By Juro Osawa, shows that traders cannot assume that their market analysis will be correct in all cases. Governments can and do step in with their dirty floats to change the direction of currencies. The article is reprinted from the Wall Street Journal below;
The Wall Street Journal
SEPTEMBER 9, 2010, 10:09 P.M. ET
Japan Government: To Intervene In Forex If Necessary
TOKYO (Dow Jones)--The Japanese government said Friday it will intervene in the foreign exchange market if needed to curb a rise in the yen that it warns could disrupt the economy and financial conditions.
"A rapid or prolonged strengthening in the yen is a problem that cannot be overlooked, given its negative impact on the stability of the economy and financial conditions," the government said in a statement accompanying an announcement of a Y915 billion stimulus package to support the economy.
"The government will take decisive steps, including interventions, when necessary," the government said.
The government also kept the heat on the Bank of Japan to do more to stop consumer price deflation, which has ravaged Japan's economy on and off for years, hindering any sustainable recovery.
The government said it will keep in close contact with the central bank with the aim of conquering deflation, adding that it expects "appropriate and flexible" monetary policy management to support Japan's economy.
-By Juro Osawa, Dow Jones Newswires; +81-3-6269-2794; email@example.com
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