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USD/JPY rebound stalls just below 160 after prior yen intervention
Traders are shifting their outlook as reports point to an informal US-Japan understanding that links support for the yen to Bank of Japan rate-hike room.
USD/JPY’s rebound from last month’s yen intervention is stalling just below the psychologically important 160 level, with the dollar back above 159 but struggling to extend gains.
Action Forex says the intervention initially worked, driving the dollar down from near 164 to around 155 within days, before most of that move reversed over roughly two weeks and the recovery runs out of steam near 160.
The outlet attributes the yen’s ongoing weakness to Japan’s persistently lower interest rates, which support a “carry trade” dynamic where investors borrow yen cheaply and buy assets elsewhere with higher returns.
Action Forex notes new reporting suggests the intervention may have been part of a broader, not purely standalone, effort, with an informal US-Japan understanding framed as yen support in exchange for Bank of Japan hiking room, while a fund manager cited by Reuters described intervention as an opportunity to sell the yen at higher levels.
Latest closeUSD/JPY 159.49 ▲0.1%