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TOKYO : The authorities in the United States, Europe and Japan drew up an emergency plan in March to rescue the plunging dollar if the currency went into freefall, a newspaper report said Thursday.
The contingency plan, which was crafted in March amid US financial market turmoil, would have involved coordinated dollar-buying intervention on the foreign currency market, Japan's Nikkei business daily reported.
The framework was compiled by officials from the US Treasury Department, the Japanese Finance Ministry and the European Central Bank over the weekend of March 15-16, it said, citing unnamed sources familiar with the matter.
They did not agree on how far the dollar would need to fall before they stepped into the market, and in the event no joint action took place, it added.
Even so, dealers said that the reported rescue plan could prevent further sharp falls of the dollar in the future.
At the time Washington was concerned that a weaker dollar was driving up the cost of imports and stoking inflation, while Japan and the eurozone nations were worried that their exporters were being hurt by a stronger currency.
The greenback sank to a series of all-time lows against the euro earlier this year and dropped below the 100-yen level, but it has since enjoyed a rebound and is now close to a six-month high against the single European currency.
There has been no coordinated intervention in the foreign exchange market by the authorities in the United States, Europe and Japan since September 2000.
There was no official comment on the report by the Japanese authorities.
The dollar stood at 109.48 yen in Tokyo morning trade Thursday, against 109.65 late Wednesday in New York. The euro rose to 1.4787 dollars from 1.4737.
- AFP /ls
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