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USD/JPY rises toward 160 as yen intervention gains fade

The pair traded at 159.53, and Action Forex flagged ongoing risks of additional Japanese intervention near 160.00 even after softer US inflation reduced expectations of an imminent Fed rate hike.

Reported · Written up by our desk · Major Pairs

USD/JPY climbed to 159.53 on Thursday, moving back toward the 160.00 area as the yen’s post-intervention gains continued to fade, according to Action Forex.

The outlet said markets remain on alert for possible further intervention by Japanese authorities amid persistent yen weakness. It pointed to fundamentals that continue to weigh on the currency, including a wide interest rate differential, rising fiscal risks, and elevated energy and import costs.

Action Forex also noted that the yen did not gain much traction even after softer US inflation data, which it said eased pressure on the Federal Reserve and lowered the likelihood of an imminent rate hike.

In Japan, producer prices rose 7.2% year-on-year in July, slightly below June’s 7.3% and the 7.4% forecast, while the Bank of Japan’s July summary of opinions highlighted growing risks of accelerating inflation and the possibility that the pace of rate hikes could quicken. On its technical view, the pair was consolidating below 159.52 and could move higher toward at least 160.50 if an upside breakout occurs.

Latest closeUSD/JPY 159.42 ▲0.2%

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