⚠️ Japan is nearing another currency intervention:
The Japanese Yen briefly weakened to 161.96 per US Dollar, its weakest level since 1986 and below the threshold that triggered Japan's last currency intervention in 2024.
Despite the Bank of Japan raising interest rates to 1.0%, the highest since 1995, the Yen continues to slide as wide interest rate differentials keep pressure on the currency.
Japan previously spent a record ¥11.7 trillion (~$72.5 billion) defending the Yen in 2024, but the intervention only temporarily slowed its decline.
Officials have recently reiterated they are prepared to take "bold action" against excessive moves in the foreign exchange market if needed.
A weaker Yen boosts exporters but also raises the cost of imported energy and food, adding inflationary pressure on Japanese households.
Markets are increasingly watching for another round of intervention as the Yen continues to test multi-decade lows.