January 24th 2006
Chrysler CEO suggests forex intervention
Over the past few months, there has been a back-and-forth between US trade lobbyists (mostly representing US automobile manufacturers) and Japan’s Central Bank. Specifically, US corporations have accused Japan’s Central Bank of repeated intervention in forex markets, designed to hold down the value of the Japanese Yen. The latest chapter in this saga unfolded yesterday, when the CEO of Daimler Chrysler suggested that the US match the efforts of Japan by intervening in forex markets and artificially depress the Dollar. Rick Wagoner, CEO of GM, recently expressed similar sentiments. Japan’s response to these allegations has been to proclaim its innocence. For almost two years, Japan has refrained from intervention, a fact that has since been verified by official data. The Associated Press reports:
“The Japanese Central Bank intervenes in currency markets to keep the yen cheap and to create an advantage for its industry. Why doesn’t our government do the same for us?” LaSorda [CEO of Chrysler] said.