The yen has surrendered more than four of the nine yen gained in Tokyo’s historic 8.45 trillion Yen intervention last month.
USD/JPY hovered near 159.50 on Tuesday, erasing over half the gains from Japan’s record 8.45 trillion Yen intervention on July 30-31. The pair has climbed more than four yen from its post-intervention low near 155.00, trading above its 200-day moving average and within striking distance of 160.00.
The intervention, which included an additional 5.3 trillion Yen the following day, initially pushed the dollar down from near 164.00, its highest level since December 1986. Seven trading sessions later, the yen’s recovery has stalled, raising questions about the durability of the move ahead of Wednesday’s U.S. inflation data.
Market focus has shifted from the intervention’s size to whether the yen can hold its gains. Analysts note that interventions are judged by their lasting impact, not the initial outlay, and the current giveback suggests a potential halfway failure.