The yen rebounded fully from early-week declines amid rising speculation of potential Japanese intervention in currency markets.
The yen recovered all its weekly losses against the dollar, pushing USD/JPY down to 161.67 on Friday. The move follows a sharp decline in the Japanese currency earlier in the week, which neared 40-year lows.
Market expectations of possible intervention by Japanese authorities have resurfaced as the yen’s volatility persists. The currency pair had faced pressure from diverging monetary policy outlooks between the U.S. and Japan.
Traders are closely monitoring official statements for signs of action, though no intervention has been confirmed yet.