Yen Stays Near 160 Despite $72.8 Billion Intervention and BOJ Rate Hike
Updated
Updated · CNBC · Jun 19
Yen Stays Near 160 Despite $72.8 Billion Intervention and BOJ Rate Hike
3 articles · Updated · CNBC · Jun 19
Summary
11.7 trillion yen in April-May support buying and a BOJ rate increase to a three-decade high still left the yen languishing around 160 per dollar, after only brief rebounds to 156.6 and roughly 155.
4.451% U.S. 10-year Treasury yields versus 2.64% on 10-year JGBs keep carry trades attractive, blunting the impact of Japan's tightening and sustaining pressure on the currency.
Early-June warnings of possible "decisive action" also reduced the shock value of any fresh intervention, while Prime Minister Sanae Takaichi's reflationary tilt and dovish BOJ appointments cloud the path to sustained policy tightening.
Imported-energy demand for dollars has added strain as the Iran war keeps prices elevated, though Nomura said speculative short-yen positions now exceed pre-Golden Week levels, leaving chances of another intervention high.
A U.S.-Iran deal that restores Hormuz shipments, along with AI investment and foreign buying of Japanese equities, could eventually ease pressure and support longer-term yen inflows.