Australia Exchange Forex News Today, be vigilant against the "black swan" raid in the foreign exchange market! Japan's top foreign exchange official warns: No options are ruled out if necessary

Currency traders are bracing for policy decisions this week from the Federal Reserve and the Bank of Japan as they received fresh reminders on Wednesday that Japanese officials stand ready to intervene if the yen moves too much.

Masato Kanda, Japan's deputy finance minister and top foreign exchange official, said on Wednesday that he was in extremely close daily contact with the US Treasury and that both sides considered excessive currency volatility unwelcome.

"We are in extremely close communication with foreign authorities on a regular basis, especially the US authorities," said Mr. Kanda, who warned that he was watching with great urgencyforeign exchange market。

His comments came after the yen fell to near its lowest level since November on Tuesday, with the greenback briefly touching 147.92.

Kanda said he would not rule out any measures to deal with the volatile market if deemed necessary, and that he would continue to follow developments with extreme urgency.The yen strengthened slightly after Mr. Kanda's speech.

Mr. Kanda was speaking ahead of the Fed's decision late on Wednesday, which is widely expected to keep rates unchanged.

The widening interest rate differential between Japan and the United States is a key factor in the weakness of the yen, making the higher-yielding dollar more attractive. The Bank of Japan is also expected to remain unchanged when it concludes its two-day policy meeting on Friday.

U.S. Treasury Secretary Janet Yellen said earlier that any intervention to support the yen would be understandable if Japan's intervention was to smooth out volatility rather than to influence exchange rate levels.

Asked whether the Treasury would understand if Japan intervened to buy yen in the currency markets, Ms Yellen said: "A lot depends on the details. We usually communicate with them about these interventions."

A year ago, as the yen continued to slide, the Japanese authorities carried out their first yen buying operation since 1998, temporarily supporting the yen's bottom, but hit a multi-decade low of Y151.95 to the dollar in October. Ultimately, Japan spent more than $60 billion in three interventions last year to stabilize the yen.

While a weaker yen is good for Japanese exporters, it has also raised the cost of food and energy imports, hurting Japanese households and causing headaches for Prime Minister Fumio Kishida.

Oil prices have surged to a 10-month high on supply concerns, raising the prospect of rising global inflationary pressures.