USD/JPY Rebounds Near 158 as Japanese Yen Weakens

The Japanese Yen has weakened despite intervention warnings as USD/JPY rebounds near 158. The US Dollar's recovery is driven by investors shifting focus back to underlying fundamentals, allowing it to recover part of its recent losses.

Last week, Tokyo and Washington conducted coordinated intervention to support the Japanese currency. Japan's Ministry of Finance confirmed this, with Finance Minister Satsuki Katayama stating that authorities would not hesitate to intervene again if necessary.

The interest rate differential continues to limit the Japanese currency's upside potential. Although the Bank of Japan raised its policy rate to 1% in June, borrowing costs remain well below those of other major economies.