Forex
Home›Forex›Major Pairs›Yen holds near 159 per dollar after record interventio…
Yen holds near 159 per dollar after record intervention weeks ago
The yen has clawed back about half of the drop from a defense that involved 8.45 trillion yen in one session, with follow-on coordination tied to Treasury flows.
The Japanese yen has stabilized around 159 per dollar in North American trading, after a record intervention three weeks earlier that was designed to blunt yen weakness, FXStreet reported. The pair is sitting in a daily range roughly between 158.50 and a high near 159.50, with the yen having recovered close to half of what that operation delivered. FXStreet said the scale of the defense was large, with 8.45 trillion yen sold in a single session, followed by about 5.3 trillion yen more in coordination with the US Treasury. The yen had fallen from just under 164 per dollar to a level little above 155, then spent every subsequent week walking back upward. The outlet attributed the ongoing price behavior to flow dynamics. It noted that Japanese investors net bought more than 5 trillion yen of foreign equities and long-term bonds in the two weeks to August 15, reversing prior net selling of more than 300 billion yen in the fortnight before. FXStreet also highlighted the mechanics of the intervention and the lack of a policy shift behind it. It said the American side of the operation appears to have been executed by selling euros rather than dollars, which left the Treasury market untouched at the time, while the Bank of Japan kept its policy rate at 1.00% versus the Federal Reserve’s 3.50% to 3.75% target range. The ten-year yield gap between the two markets was described as near 1.8 percentage points, with the US long end at multi-decade highs.