Japan has $1 trillion in dollar reserves for intervention
Japan’s capacity for yen intervention is not a concern, with about $200 billion in cash or cash equivalents available.
The timing and trigger for intervention are the key variables, with weak US data or a BOJ miss potentially triggering action.
The September BOJ decision is a significant factor, with a potential failure to deliver a hike likely to lead to intervention.
Japan’s intervention is more effective when triggered by soft US data prints, rather than reacting to yen weakness