UPDATE 1-Joint yen intervention unlikely -euro zone source

* Solo BOJ intervention more likely than joint action -source

* Japan jittery about yen but U.S. and Europe less so -source

(Adds background)

By Gabriella Bruschi

MILAN, Aug 26 (BestGrowthStock) – Joint central bank intervention to
stem the rise of the yen is not likely, and it is more realistic
to expect Japan to act alone, a euro zone source familiar with
the situation said on Thursday.
The yen hit 15-year highs against the dollar earlier this
week but has since pulled back on mounting speculation that
Japanese authorities may intervene for the first time since
March 2004 to stem the yen’s rise.

“At present it seems more realistic to see a unilateral
intervention on forex market (Read more about the difference between the forex market and the stock market. )s by the Japanese authorities,” the
source, who spoke on condition of anonymity, told Reuters.

“At the moment I see a lot of jitters in Japan, but I don’t
see anything similar in the United States or in the euro zone,”
the source said. “Clearly the current levels of their respective
currencies are not regarded as being that negative.”

The source did not entirely rule out co-ordinated
intervention, however, and said that such a case would most
likely involve the Federal Reserve and each central bank acting
on its own currency.

“The main focus is the dollar/yen, so one could think that
the United States could possibly act with Japan. An ECB
intervention on the euro/yen seems more difficult, also because
the Japanese currency has more of an impact for the U.S. than
for the euro zone economy.”

“Even a possible euro/yen level of 100 should not trouble
the ECB,” the source added.

The dollar rose slightly to 84.60 yen on Thursday, having
moved in a narrow range of 84.49-84.90 yen all day. Earlier this
week it hit a 15-year low of 83.58 yen.

The euro also pushed slightly higher against the Japanese
currency at 107.52 yen, extending its recovery from a nine-year
low of 105.44 yen hit on Tuesday. [FRX/]

Markets have been rife with speculation that the Bank of
Japan will ease monetary policy further before its regular rate
review on Sept. 6-7 at an emergency meeting.

Bank of Japan Governor Masaaki Shirakawa will attend the
Kansas City Federal Reserve’s conference in Jackson Hole in the
United States this week, and analysts say that an emergency
meeting is less likely to take place while he is away.

Shirakawa, who chairs the BOJ’s policy meetings, will return
to Tokyo on Aug. 30.

Earlier on Thursday, Japan’s deputy finance minister
Motohisa Ikeda said the yen’s rapid rise was undesirable for the
economy. [ID:nTKX006952]

He added that he believed the Bank of Japan would “make an
appropriate decision on monetary policy based on market and
economic trends.”

The euro zone source familiar with the situation noted that
coordinated intervention by central banks had been rare in the
past 10 years, adding it was “a very complex operation that
requires good agreement on what is the right exchange rate.”
(Writing by Silvia Aloisi; editing by Patrick Graham and Hugh
Lawson)

UPDATE 1-Joint yen intervention unlikely -euro zone source