FX.co ★ Yen Holds Advance on Intervention Risk

The Japanese yen was valued near 154 per dollar on Tuesday, following a robust 3.2% surge over the prior two trading sessions. This significant appreciation followed concerns regarding a possible collaborative foreign exchange market intervention by both Tokyo and Washington. The market fluctuations were instigated by reports on Friday that the New York Federal Reserve performed a rate check on the dollar/yen exchange with traders, accompanied by indications that Japanese officials are closely working with the US concerning currency policies and prospective market interventions. Simultaneously, insights from the Bank of Japan indicated that the yen's sharp increase on Friday was probably not due to official intervention. Additionally, the yen gained strength from a broad decline in the dollar, influenced by escalating geopolitical and trade tensions, and speculation that US President Donald Trump may soon appoint a more dovish candidate to replace Fed Chair Jerome Powell, which further pressured the US dollar.