FX desks are on alert for possible Japanese intervention after reports that
Japan's finance minister Katayama and US treasury secretary Bessent held an
online discussion that may have touched on exchange rates. USD/JPY traded around
161.57 early Tuesday, near a 40-year low. NHK and Kyodo reported the officials
may have discussed the currency. Traders say the yen remains under pressure
after the Bank of Japan’s recent rate hike failed to raise borrowing costs
quickly enough to curb inflation, and higher oil prices linked to the US‑Iran
war add further strain. A Sumitomo Mitsui Trust Bank New York trader, Takeru
Yamamoto, said Japanese authorities may seek to signal coordination with the US
and that the intervention threshold is not high; he added USD/JPY could test the
162 area this week despite the underlying fundamentals.
