The yen slid to touch the key psychological level of 150 per US dollar, bringing the risk of intervention by Japan back into focus.
The currency dropped as much as 0.3% to trade a 150.08 per US dollar, a level last seen on Aug 1. The latest decline follows two straight weeks of drops, as investors recalibrate for a slower narrowing of the yield gap between Japan and the US.
The yen’s outlook has changed, with new Prime Minister Shigeru Ishiba suggesting earlier this month that the nation isn’t ready for higher interest rates, though he pulled back later to say he’s seeking to align with the Bank of Japan. Reports out of the US pointing to a resilient economy, pushing markets to price in a slower pace of monetary easing by the Federal Reserve, have also weighed on the yen.
Japan’s finance minister, Katsunobu Kato, recently said that sudden moves in the yen hurt companies and households, and that impact requires government scrutiny. The country’s chief currency official Atsushi Mimura also said that he was monitoring the foreign exchange market with a sense of urgency.
