REPEAT: MNI: Japan Aso: Yen Not Too Strong/Weak;Not Acting Now

     TOKYO (MNI) - Japanese Finance Minister Taro Aso Thursday said the yen's

recent appreciation is not too steep, and thus that it would not prompt Tokyo to

intervene in the foreign exchange market to stop a rising yen from hurting the

economy.

     "It is true that we have done verbal interventions in the past when

something urgent happened," Aso told the Lower House Budget Committee. "But now

the economic fundamentals in both the U.S. and Japan are very good."

     "The current situation is that the yen has not sharply appreciated or

depreciated. We are not considering intervening immediately at this point," he

said.

     Aso was asked whether the dollar's fall below Y107 would hurt the Japanese

economy by reducing exporter profits.

     The dollar was quoted around Y106.60 in Asian morning trading Thursday,

down from above Y112 at the start of the year.

     Aso noted that U.S. Treasury Secretary Steven Mnuchin had corrected his

remark after saying that a weaker dollar was good for the U.S. economy in

January.

     Japanese policymakers appear to be comfortable if the dollar/yen exchange

rate remains stable in a range from around Y105 to about Y115, or in a wider

Y100 to Y120 range.

     A few years after the yen hit a record high of Y75.54 to the dollar in

2011, Japanese ruling party politicians saw a dollar above Y105 as having

corrected the yen's steep rise. But they also feared a level above Y120 would

hurt small businesses and households with higher import costs.

     In his parliamentary testimony, Aso made similar forex comments in 2016.

     At the time, Aso told the Upper House Audit Committee that Tokyo would

notify Washington of its intention to intervene should forex market volatility

increase sharply.

     "The yen appreciated to the Y105 level last week but it is now around

Y107.30. We are not at the stage of doing anything particular," Aso told the

committee on May 9, 2016.

     Japanese officials generally do not draw a line in the sand, aware of the

strength of market forces when trading surges in one direction, and of the fact

that ineffective intervention to sell yen for dollars would only provide

speculators with an opportunity to sell dollars again.

     However, judging from past record, Tokyo would seek Washington's consent to

step into the foreign exchange market to stop one-sided, rapid dollar selling

for yen that could wipe out exporter profits and undermine a recovery in the

stock market and economic activity overall, in turn denting U.S. exports to

Japan.

--MNI Tokyo Bureau; tel: +81 90-4670-5309; email: max.sato@marketnews.com