Japan's former top currency diplomat Hiroshi Watanabe said on Thursday, the recent depreciation of the yen is unlikely to be reversed by tightening monetary policy or intervening in the currency market.

Key quotes

“The yen, now hovering around 118.90 yen may fall below 120 to the dollar and add pressure on Japan's resource-poor, import-reliant economy.”

"The Bank of Japan continues to say a weak yen is good for the economy. But if crude oil prices keep rising, it's uncertain whether it can keep saying so."

Still, there were little policymakers can do to arrest yen declines.”

"Intervention (to stop yen falls) won't work given the huge size of the global currency market.”

USD/JPY reaction

The pair was last seen trading modestly flat on the day at 118.75.