TOKYO, July 5 -- Japan's Finance Ministry fired no warning shot before spending Euro11.73 trillion, roughly $73 billion, to prop up the yen in the two months through May 27. The silence around that operation was not a tactical mistake. It was the beginning of a new strategy.

Finance Minister Satsuki Katayama said Thursday that Tokyo will act in foreign exchange markets "at any time as needed" to address what it calls excessive yen moves, including during US market holidays when trading is thinner and the yen most exposed to one-sided positioning. The yen stood near 161.2 per dollar, having retreated from a 40-year low of 162.84 hit earlier in the week. Katayama declined to name any threshold at which the government would intervene. That ...