USD/JPY Eyes 160 as Global Bond Yields Soar

The USD/JPY pair is testing the waters above the 160.00 level despite US Treasury Secretary Bessent's comments warning of potential action to strengthen the yen.

Traders are not paying much attention to Bessent's warnings, and the currency pair is instead driven by the broader selloff in global bonds, which has led to higher yields on 10-year Treasuries at 4.78%, a significant breakout from recent ranges.

The Japanese government may intervene if USD/JPY moves too far, too fast, given Bessent's warnings and the upcoming BOJ policy decision later this month, but for now, traders are cautiously pushing the pair higher in anticipation of further bond yield increases.