FX.co ★ Yen Firms Up on Dollar Weakness

The Japanese yen maintained its upward trajectory, reaching approximately 156 against the US dollar on Wednesday. This one-week high was primarily supported by the weakening of the dollar, as traders increasingly speculated on a potential interest rate cut by the US Federal Reserve in December. This anticipation followed recent US data indicating a decline in consumer spending, along with reports that a dovish candidate might be considered for the Fed chair position. Additional support for the yen came from growing speculation about possible intervention by Japanese authorities in the currency markets. The upcoming US Thanksgiving holiday on Thursday was seen as an opportune moment for such action by Tokyo. On Sunday, Takuji Aida, an adviser to Prime Minister Sanae Takaichi, stated that Tokyo is prepared to intervene decisively to mitigate the adverse economic impacts of a weaker yen. His comments were in line with recent statements by Bank of Japan Governor Kazuo Ueda and Finance Minister Satsuki Katayama.