BOJ Rate Hikes and Yen Intervention Speculation Soars Amid Dollar Support

The yen has experienced its biggest weekly loss in about a month, falling by approximately 0.9% to 159.29 per dollar. This decline mirrors a similar selloff in May, when the currency also backslid after official buying.

Traders see the 160 level as a potential trigger for fresh official intervention or currency buying. The Japanese currency's retreat has led to speculation that either rate hikes or another round of official buying will be needed to stem the decline.

The Bank of Japan is considering more aggressive interest rate hikes and could raise rates as soon as September to support the yen, according to sources familiar with the bank's thinking. Reuters reported on Friday that the BOJ has raised interest rates at a pace of roughly twice a year since exiting a massive stimulus in 2024.