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Japanese yen spikes in suspected intervention, driving EUR/JPY lower

EUR/JPY slid more than 400 pips in minutes after a sudden JPY rally, while USD/JPY fell below 161.00.

Reported · Written up by our desk · Major Pairs

EUR/JPY tumbled sharply on Thursday after the Japanese yen surged in what traders suspect was another round of currency intervention by Japanese authorities, with the pair down 2.5% to around 182.60 at the time of writing. The move was described as especially abrupt, with EUR/JPY losing more than 400 pips within minutes.

The yen rally came without an obvious economic catalyst, reinforcing speculation that the Japanese Ministry of Finance stepped in to curb the currency's persistent weakness. FXStreet noted the development recalled late April, when the yen gained nearly 3% against the US dollar after USD/JPY hit 160.72 and officials issued warnings about possible “decisive” action.

On the US dollar front, USD/JPY also dropped, trading below 161.00 as other major yen crosses weakened broadly. With the Bank of Japan policy decision due Friday, markets are focused on whether any updated economic projections and Governor Kazuo Ueda’s comments hint at a rate hike timing.

In Europe, FXStreet pointed to limited support for the euro from recent data, including Germany’s second-quarter GDP growth of 0.2% quarter over quarter, and an acceleration in annual growth to 0.9%. For the wider eurozone, the economy expanded 0.4% in the second quarter and 1% year over year, alongside a July improvement in consumer confidence and economic sentiment, even as the unemployment rate edged up to 6.3%.

Latest closeUSD/JPY 163.42 ▼0.2%

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