Japanese Yen: Policy focus after intervention - MUFG
MUFG’s Teppei Ino reviews recent USD/JPY price action following coordinated Japan-US intervention. The pair opened near 157.58, dropped toward 155.20 on official confirmation of joint action, then recovered and traded above 158 by 7 August.
On 3 August, the USD/JPY currency pair plummeted to 155.20 following the announcement of a coordinated intervention by both Japan and the United States. Finance Minister Satsuki Katayama's statement, along with remarks from Atsushi Mimura, Vice Minister of Finance for International Affairs, confirmed the joint action. The pair experienced further fluctuations, trading near 158 by 4 August, before being capped by subsequent signals from Japan and the US that they might intervene again.
On 6 August, following reports that Fed Chair Kevin Warsh might consider a September rate hike, the USD/JPY surged above 158 and reached 158.50. This recovery continued into 7 August, with the dollar facing a decline after the Federal Open Market Committee's meeting, which was offset by Japan and the US's readiness to intervene once more.
Throughout this period, movements in major currencies remained relatively contained within a 1% range.
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