USDJPY: The Japanese yen rose suddenly amid intervention specula

The Japanese yen experienced a notable rise on Monday, which analysts interpreted as a potential sign of intervention by Japanese authorities in the foreign exchange market. The move comes after a significant depreciation of the yen, which has fallen nearly 11% against the dollar this year and 35% over the past three decades, recently hitting a 34-year low.

Monday's operation follows months of warnings from Japan that it may intervene in foreign exchange markets. The Japanese government's most recent intervention took place in September and October 2022, with an estimated 9.2 trillion yen ($60.78 billion) spent to support the currency. This is not the first case of intervention; During the 1998 Asian financial crisis, the yen fell nearly 25% in 14 months, prompting the United States to join Japan in a successful intervention effort.

Comment:

The Yen recovered weakly, USD/JPY returned to above 156
The Japanese yen weakened sharply on Thursday, with recovery limited amid what appears to be continued government intervention in currency markets, as the specter of high US interest rates continues.

USDJPY - which measures the number of yen needed to buy a dollar - rose 1% to 156 in late morning trading, after sliding to as low as 153 on Wednesday.

While the dollar's sharp decline also contributed to the yen's recent rally, the sharp downside moves in USD/JPY seen on Monday and Wednesday had traders speculating about the ability of the government to intervene in the currency market.