Little change expected for yen in run-up to fiscal year-end

Japan's former vice-minister of finance for international affairs, Eisuke Sakakibara, aka 'Mr Yen', has suggested the yen should ‘ideally’ depreciate to the 160-180 range against the dollar, further fuelling speculation that the yen could decline sharply in 2002. However, regional forex strategists believe further depreciation is unlikely to occur as Japan’s fiscal year-end approaches.

In an address at the Foreign Correspondent’s Club in Tokyo on February 21, Sakakibara attacked what he perceives as the Japanese government’s so-far inadequate financial and structural reforms. He predicts that Japan is likely to face an economic crisis this year, precipitating a yen fall to between 150-170 against the US dollar. However, the markets barely responded, and there was no impact on the dollar/yen, which ended the day at 133.78, compared with 133.66 the day before. “He was always