TOKYO -- Japan's emergency plan to stem the fall of the dollar against the yen and to stimulate the nation's economy failed to impress the financial markets yesterday, raising fears here that the dollar's fall could resume next week.
Critics said the measures, announced yesterday, were vague and lacked teeth. "I'm a little bit shocked at seeing today's package," said Masaru Takagi, chief economist of the Fuji Research Institute, associated with the Fuji Bank. "There are no concrete figures yet, no concrete features at all."
Currency markets seemed to shrug off the announcement, with exchange rates barely budging. In late trading in Tokyo, the dollar was quoted at 83.58 yen, up only slightly from 83.50 yen in late New York trading Thursday.
Trading was kept thin by the Good Friday holiday, which closed other major financial centers.
Stock investors gave an even harsher reception. After having climbed for four consecutive days, partly in anticipation of yesterday's package, the Tokyo stock market fell sharply yesterday. The Nikkei average of 225 stocks dropped 390.90 points, or 2.4 percent, to 16,047.89.
The emergency plan was announced yesterday in response to Monday's sharp drop of the dollar to a postwar record low of 80.15 yen in Tokyo. The weak dollar and strong yen are threatening to derail an economic recovery that has just begun in Japan by choking off exports.
In perhaps the most significant of yesterday's measures, the Bank of Japan cut the official discount rate by three-quarters of a percentage point, to a record low for Japan of 1 percent. The currency markets had already been expecting such a cut.
The government, in effect, was trying to convince the currency markets that it was serious about lowering Japan's trade surplus, which is considered a major factor behind the long-term rise of the yen.
It failed to convince. Yesterday's measures consisted largely of statements of intent rather than actions.