The Japanese yen weakened toward 159 per dollar on Monday, extending its slide for a sixth straight session as the US dollar strengthened on growing expectations that the Federal Reserve may need to raise interest rates this year to rein in inflation. US inflation has accelerated, driven in part by an energy price shock linked to the conflict in the Middle East, where the US and Iran have yet to reach a peace agreement or make progress on reopening the Strait of Hormuz.
The yen is now approaching the closely watched 160-per-dollar level, a threshold that previously prompted Tokyo authorities to intervene in late April to shore up the currency. Market participants remain on alert for another potential intervention, particularly after some Japanese officials indicated there is no cap on how often authorities can act in the foreign exchange market. Adding to the focus, US Treasury Secretary Scott Bessent has voiced support for Japan’s recent measures to stabilize the yen.
