Japanese Prime Minister Yukio Hatoyama today made a rare call for 'firm steps' to stem the strength of the yen after the currency's recent advances hit exporters' earnings.
Hatoyama said the current high value of the yen gave a misleading impression of the world's second-largest economy, adding: 'Japan's economy and industries aren't necessarily strong'.
'I think we need to take firm steps against such yen strength,' he told a parliamentary session, adding that 'there is a need to 'politically cooperate on the world stage'.
Hatoyama's comments appeared to mark a departure from his previous stated position in January when he said the government in principle should not discuss foreign exchange, contradicting calls by finance minister Naoto Kan for a possible intervention.
The yen surged to 14-year highs against the dollar in November. A strong yen hurts the competitiveness of Japanese exporters when their overseas earnings are repatriated.
The currency's strength has also coincided with Japan's struggle to recover from its worst post-war recession.
Japan has not intervened on foreign exchange markets since March 2004, allowing the yen to find its own level. The finance ministry can intervene by ordering the Bank of Japan to carry out monetary operations.
