An example of indirect intervention by the Bank of Japan would be for the Bank of Japan to use interest rates to increase the value of the yen vs. the dollar.

Question

Quizplus · Accepted Answer

Indirect intervention by the Bank of Japan refers to the use of monetary policy tools such as interest rates or quantitative easing to influence the value of the yen, without directly buying or selling yen on the foreign exchange market. By increasing interest rates, for example, the Bank of Japan can encourage capital inflows, which can lead to an increase in demand for yen and a strengthening of its value relative to the dollar.

An Example of Indirect Intervention by the Bank of Japan