The yen surged from the weakest levels in a year versus the dollar amid speculation that Japanese officials were acting to slow the currency’s slide.
Japan’s currency reached 150.16 per dollar on Tuesday in New York trading, the weakest since October 2022, in the wake of a report showing U.S. labor demand remains resilient.
The yen then soared nearly 2% in a matter of seconds to as strong as 147.43 per dollar. It last traded at around 148.90, weakening again as U.S. yields rose.
“We won’t know until official confirmation, but it sure feels like it,” Bipan Rai, CIBC’s global head of foreign exchange strategy, said of the possibility Japanese officials had acted.
Japanese officials couldn’t be immediately reached for comment.
Masato Kanda, the top currency official at the Ministry of Finance, has said he’s keeping in close contact with his U.S. counterparts, with both sides in agreement that excessive currency moves are unwelcome. Finance Minister Shunichi Suzuki warned about the currency fluctuations for six days in a row through Tuesday. He said on Tuesday he won’t judge the possibility of forex intervention on currency levels but through volatility.
The first intervention by Japan last year came when the yen weakened to 145.90 in September. The country spent around $65 billion in total to support the yen on three occasions in September to October.