Japan readies yen intervention as USD/JPY nears 160

Japan's government signalled it is prepared to intervene in the foreign‑exchange market at any time as the yen continues to weaken against the dollar. Finance Minister Satsuki Katayama warned of “decisive measures,” while Chief Cabinet Secretary Minoru Kihara told reporters the administration will act “appropriately to currency moves as needed.” The yen slipped to 160.795 per dollar, a level not seen in almost two years, erasing gains from the April 30 intervention.

The Bank of Japan recently raised its policy rate to a 31‑year high of 1% but remains far below the U.S. Federal Reserve’s 3.5‑3.75% range, widening the monetary‑policy gap. Authorities spent a record 11.7 trillion yen (about $73 billion) intervening between late April and early May, yet the currency has reclaimed its losses. Market analysts note a surge in speculative short positions and warn that without further action the dollar‑yen pair could close at its highest weekly level since 1986, hovering around 160‑161.