Bank of Japan account data suggest the government did not mount a large-scale
yen intervention on Wednesday, indicating recent sharp FX moves reflected
traders’ position adjustments as they revised BoJ rate expectations. The BoJ
forecast the current account would shrink by ¥410 bln due to fiscal factors; an
average estimate from three accounting firms was about ¥700 bln. That gap is
well below ¥729 bln, the smallest intervention since 2022, and too small to
imply the scale of yen-buying seen a month earlier. Market moves were partly
driven by comments from US and Japanese policymakers that spurred speculation of
accelerated tightening, but sources said the BoJ currently leans toward a 25bps
Hike at the September meeting, dampening bets on a larger move.
