Japanese yen nears intervention thresholds after Fed’s hawkish stance lifts USD/JPY to multi-year highs.
The US dollar climbed to 161.37 against the yen, its highest level in over a year, following the Federal Reserve’s hawkish policy stance. The move pushed USD/JPY into a zone that previously triggered Japanese authorities to intervene in currency markets.
Prior interventions occurred when USD/JPY approached or breached similar levels, as Japan sought to stabilize the yen amid sharp depreciation. Markets are now closely monitoring for potential yen-support operations, particularly as US yields remain elevated and the dollar strengthens.
Risk sentiment saw modest improvement as traders digested the Fed’s higher-for-longer rate outlook, supported by resilient US economic data. Labor market strength and consumer spending reinforced expectations for prolonged tight monetary policy.