Following Swiss Lead, Japanese Move to Stem Yen Strength

A day after Switzerland acted to weaken the Franc, Japan moved Thursday to tame the Yen's strength by selling one trillion Yen, or more than $12 billion. Japan's action today sent the dollar up against the Yen and most major currencies, including the Euro and Pound Sterling. Finance officials have repeatedly warned of the possible consequences of sustained Yen strength. Finance Minister Yoshihiko Noda indicated to reporters that sources from around the world were consulted on the decision, but the nation eventually sold to hasten disorderly market moves. "Japan is just in the process of recovering from a natural disaster, so these currency moves are certain to have a negative impact on the economy and financial markets," Noda said Thursday. The move by Japan comes after Switzerland announced Wednesday that it was instituting measures to tame the strength of the Franc. Both the Franc and Yen are seen as safe-haven currencies in times of uncertainty. With continued debt problems in the Euro zone and a hazy recovery outlook for the United States, many investors are flocking to the currencies and gold to avoid volatility. The Bank of Japan left its benchmark rate unchanged at 0-0.1% in a short meeting this week.