The yen jumped on Friday after Japan's finance minister Katayama called for
pension funds to increase domestic asset allocations, briefly reversing the
currency's decline. USD/JPY fell about 0.7% to 161.29. Investors remain
skeptical the gain will stick, citing lingering geopolitical risk, fiscal
concerns and interest-rate differentials; without follow-up measures the yen
could resume weakness toward new 40-year lows. Official intervention risk
persists, but markets are broadly doubtful the government's previous record
yen-buying operations were effective. State Street's Tokyo manager Wakabayashi
Bart said: "This may change the market narrative, but it is only an immediate
reaction; further yen strength will require more commitments."
