The Japanese yen jumped as much as 0.8% to ¥155.72 per dollar on Monday in thin holiday trading before giving back most of those gains, as markets watched for signs of more Japanese intervention. [1]
Japan likely spent about ¥5.4 trillion, or $34.5 billion, last week to support the currency and slow its decline, according to market estimates. [1] That intervention has kept traders on edge about another round of action from Tokyo. [1]
Finance Minister Satsuki Katayama declined on Monday to confirm or deny further foreign-exchange intervention, and said recent market moves were speculative. [1] Commodity Futures Trading Commission data showed asset managers and hedge funds were the most bearish on the yen since July 2024. [1]
Goldman Sachs analysts estimated Japan has room to intervene about 30 more times at last week’s scale, though they said authorities may want to save reserves for moments when action can have the biggest effect. [1] Wall Street analysts have marked ¥160 per dollar as the key line of defense for the yen. [1]
David Forrester, senior strategist at Credit Agricole CIB, warned that low liquidity during the Golden Week holiday could exaggerate currency swings. “Low levels of liquidity due to the Golden Week holiday will lead to exaggerated moves,” he said, adding that traders should watch the 157 level in dollar-yen after the pair twice stalled just above that point following the reported intervention. [1]
Trading is expected to stay sensitive to any fresh signs of Japanese action as the holiday-thinned market continues. [1]