The Japanese yen weakened to around 159.5 per dollar on Thursday, extending its decline for a third straight session as the US currency gained amid mounting uncertainty over diplomatic efforts to resolve the Middle East conflict. While Washington insisted that peace talks remain underway, Iran signaled it has no intention of engaging in direct negotiations with the United States. Tehran indicated it would reject a US-backed ceasefire proposal and instead advanced a five-point plan that would grant it control over the Strait of Hormuz.
The yen also came under pressure from a rebound in oil prices, which heightened inflation concerns and darkened Japan’s growth outlook. At the same time, Japan this week received two oil tankers from the Middle East that avoided the key maritime chokepoint, offering some relief on the supply front. A former Japanese national security adviser proposed that Tokyo consider deploying warships to help safeguard the waterway in coordination with other nations, thereby protecting both Japanese vessels and those of its international partners.
