US and Japan Unite in Rare Intervention, Send USD/JPY Plummeting

The US dollar against the Japanese yen (USD/JPY) has plummeted to 155.20 after a rare joint intervention by the US and Japan, its lowest level since March.

Last week, USD/JPY neared 164.00, but after four consecutive trading sessions of decline, investors who previously bet on the continuous depreciation of the yen began to unwind their positions.

The direct participation of the US in this intervention has changed the market's assessment of the yen, implying that its depreciation is no longer a domestic issue for Japan but rather a risk that could affect global financial stability and the US Treasury market.

The Bank of Japan's policy stance has also provided support for the yen. The BOJ kept its policy rate unchanged at 1% in July but stated it will continue to raise rates as underlying inflation approaches 2%.