TOKYO - Japan issued its strongest warning over sharp currency movements in weeks after the yen set a fresh 10-month low against the US dollar overnight.

The nation’s top currency official said speculative moves could be seen in the foreign exchange market and warned that Tokyo was prepared to take action if needed.

“If these moves continue, the government will deal with them appropriately without ruling out any options,” said Mr Masato Kanda, vice-finance minister for international affairs.

The comments come after the yen weakened to 147.80 against the dollar.

The US currency strengthened against major peers amid a sell-off in Treasuries.

The Singapore dollar has also surged some 10.7 per cent against the yen in 2023.

The Singdollar was trading at 108.35 yen at 9.36am on Wednesday versus 97.85 yen at the end of 2022.

The yen edged higher after the remarks, briefly touching 147.37 as traders weighed the risk of Tokyo intervening in the market for the first time since October 2022.

Mr Kanda said currencies should move stably in the market in a reflection of economic fundamentals.

Officials are watching the market with a high sense of urgency, he added.

“These developments bring uncertainty to businesses and households, which will have a negative impact on the economy,” he said.

Japan’s currency officials have largely stayed quiet in recent days as the yen inched lower.

They repeatedly said in the past that they are concerned about sharp movements in the yen rather than specific levels against other currencies.

Last year’s interventions came after the yen moved more than 2 yen against the dollar in less than 24 hours.

“The yen suddenly fell by more than 1 yen overnight, which had already increased concern about verbal intervention,” said Monex bond and currency trader Tsutomu Soma. “Still, there’s still some way before an actual intervention. Market participants themselves see the line of 150 as a big hurdle.” BLOOMBERG