The head of Japan's Business Federation, the nation's most powerful business lobby, called on the government on Friday to take any and all measures to counteract the yen's rapid appreciation against the dollar.
The dollar weakened about 2 yen from the previous day in Tokyo to the upper 84 yen range at one point early Friday morning, while the euro also fell against the yen to trade briefly in the lower 127 yen range, causing rampant anxiety in business and political circles.
"We urge for all possible measures to address this emergency situation,'" said Fujio Mitarai, chairman of the Japan Business Federation (JBF) to the press on Friday.
Japan's export-driven economy is reeling under the burden of such a strong yen, as any profits made abroad are eroded when repatriated into domestic currency.
"If a steep rise in the yen and falls in equity continue, it could further depress economic conditions. We are standing on the edge," said Mitarai.
The JBF chief implored the government to do everything in its power to decelerate the yen's surging value against its U.S. counterpart, including the government dollar-buying initiatives to help bolster the sinking greenback.
The Japanese government hasn't intervened in money markets since the first three-months of 2004, but the deluge of disquiet in the business sector may prompt the government to act sooner rather than later.
Japan's Finance Minister Hirohisa Fujii said on Friday that the sharp appreciation of the yen against the U.S. dollar is "one-sided" and harmful to the Japanese economy.
"The (current) fluctuation is abnormal," Fujii said to the press, adding that the government will handle the situation "appropriately," although he once again declined to elaborate on specific government policy on potential intervention measures into the currency market.
"The government should consider all options, including dollar-buying market intervention," said Mitarai, who is also the chairman of Canon Inc., an office automation and electrical maker amongst those hardest hit by the recent yen surge.
Mitarai indicated on Friday, as have a number of prominent business leaders, that a stronger yen could trigger a double-dip recession.
The yen has been rising to levels against the dollar unseen in the past 14 years./.