USD/JPY plunged as much as 3% to 158.34 on Thursday, off this week’s 40-year
high and on course for its largest one-day fall since end-2022. Traders widely
saw the move as bearing the hallmarks of Japanese government FX intervention
after months of yen weakness. Tokyo has warned it would act if the yen kept
sliding; surging energy import costs have amplified household pressure and
raised the political cost of depreciation. The move came ahead of Friday’s BOJ
policy meeting and after the Fed left rates unchanged in a split vote on
Wednesday, which weakened the dollar. FX strategists said month‑end
position-squaring, weak US data and dollar softness created a favorable window
for authorities to buy yen. Japan’s finance minister Katayama has repeatedly
reiterated the government stands ready to act in FX markets.
