Its nice that the G7 wants to limit volatility in asset markets and make sure risk is priced in reasonable terms. Bully for them.
However, with the ECB trying to raise rates and the US letting out more hawkish speak on inflation, thereby making it likely FF rates stay here for a while, the differential between USD-JPY and EUR-JPY rates will remain largely the same, unless the BOJ raises rates which it is only going to do slowly because of fears of re-igniting th deflation it only just ended and tentatively at that.
So, aside from scaring people to stop using the carry trade, what good does it do? A 25 bp hike by the ECB in march and a 25bp hike by the BOJ nets out to zero difference in the interest rate, hence, a continuation of the carry trade.
Of course, a new program in management of exchange rates might happen.
My, isn't it interesting how the USD decline is being cautiously managed.
