Traders eye potential Bank of Japan action after the yen weakens past 162, its highest level since the 1980s.
The Japanese yen fell to multi-decade lows against the dollar, with USD/JPY surpassing 162 for the first time since the 1980s. Rising import costs and inflation concerns have intensified pressure on Japanese officials to intervene, following a $70bn sell-off in late April and early May at levels above 160.
Market participants anticipate another round of intervention in the coming days or weeks, though timing remains uncertain. The Bank of Japan may delay action ahead of key US events, including Federal Reserve remarks and the June jobs report, with a potential window opening around the US July 4th holiday.
Failure to act this week could push intervention to mid-July, aligning with Japan’s Marine Day holiday. A stronger US dollar rally, driven by fundamental factors, continues to limit yen support, while IMF regime classification concerns add further complexity.