Business

Japanese stocks drop 3.5% on yen fears

Japanese stocks have seen sharp falls in response to the Bank of Japan's attempts to curb the rising yen.

In Tokyo, the Nikkei 225 index fell more than 3.5%, hitting a fresh 16-month low.

On Monday, Japan's central bank announced plans to boost low-interest lending, in an effort to bring down the value of the currency.

But the yen remains at 15-year highs and investors are concerned over the impact that could have on exporters.

A strong yen makes Japanese goods more expensive abroad, hitting exporters' profits.

Electronics giant Sony was hit by the sell-off, losing 3.66% of its share price.

'Tokenistic gesture'

Car maker Toyota was down nearly 2.4%, while Toshiba lost 4.7%.

The Bank of Japan said it would boost cheap lending to commercial banks by 10 trillion yen ($117bn; £75bn), in an attempt to ease pressure on the yen.

The Japanese government also said it would initiate a further 920 billion yen of stimulus measures.

But BBC Tokyo correspondent Roland Buerk said the move had been seen as a "tokenistic gesture" by investors.

"Government ministers here have been trying to talk down the yen," he said.

"They have said they will take decisive action, [but] the problem is that the limited action they have taken so far has looked anything but decisive."

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