G7 countries intervene to stabilize yen

TOKYO, March 18 (UPI) -- The United States and other major industrial powers stabilized the yen by intervening in the currency markets for the first time in a decade, officials said.

Markets immediately responded to the Group of Seven move Friday by driving down the yen against the U.S. dollar after almost a week of sharp increases. The yen hit an all-time high against the dollar Thursday.

The Nikkei 225, the Tokyo Stock Exchange's leading index, surged on the news.

"At a time when Japan is in a difficult situation, it is extremely significant that G7 authorities agreed to act in concert and cooperate for the stability of the markets," Japanese Finance Minister Yoshihiko Noda said in announcing the agreement after a 90-minute conference call with finance ministers and central bankers.

The United States was represented by Treasury Secretary Timothy Geithner and Federal Reserve Chairman Ben Bernanke. Geithner briefed U.S. President Barack Obama on the decision, officials said.

The call, held before Tokyo's markets opened, included officials from Canada, Germany, Italy and Britain, Japan said.

The rising yen threatened to undermine demand for Japanese exports, hurting Japan's recovery from the March 11 earthquake and tsunami, and the subsequent nuclear crisis, officials said.

Japanese officials said Thursday they could handle the situation on their own and simply wanted other G7 members' approval, but they requested and received additional help during the conference call, The New York Times reported.

"We express our solidarity with the Japanese people in these difficult times, our readiness to provide any needed cooperation and our confidence in the resilience of the Japanese economy and financial sector," the G7 statement said.

The decision was the first time since 2000 that the G7 nations made a coordinated intervention into the currency markets. The action was taken then to stabilize the euro.

The G7 -- made up of the United States, Japan, Britain, France, Canada, Italy and Germany -- focuses on financial issues. The G8 -- which is the G7 countries plus Russia -- is generally a forum for foreign affairs, energy and security cooperation.