‘Big Splash’ Yen Intervention Should Work, Goldman Sachs Says
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Japan’s first sale of yen since 2004 to curb gains that threaten an export-led recovery is likely to succeed, according to Goldman Sachs Group Inc.
The “big splash” intervention, which was highly visible and quickly confirmed by the Finance Ministry, should help the currency weaken to 90 per dollar in a year, wrote Thomas Stolper, senior global markets economist at Goldman Sachs in London, in a research note to clients today. The yen may still appreciate over the next six months to a record 79 against the dollar, encouraging Japan to sell more of its currency, according to Stolper.