BOJ Rate Check Sends USD/JPY Below 157 as Tokyo Eyes Yen Pace

A brief check by the Bank of Japan on Friday led to a slight dip in USD/JPY below 157.0.

This move suggests that Japanese authorities are monitoring the pace of yen movements over a rolling period, rather than defending a fixed threshold.

As it stands, policy divergence between the Federal Reserve and the Bank of Japan remains the dominant driver of yen movement.

The risk of intervention is described as elevated, but USD/JPY still has scope to rise further, with prevailing conditions aligning for a return to 160.0.