Yen Fades After Intervention as Market Focus Shifts to Monetary Policy

The Japanese yen has lost almost half of its gains from last week's US-Japan currency intervention, as market attention shifts to monetary policy. The yen was trading at around 158.5 against the US dollar on Friday, compared to about 155 immediately after the intervention on July 31. Before the coordinated move by the US Treasury and the Bank of Japan (BoJ), the Japanese currency had weakened beyond 163 per dollar.

The intervention initially pushed the yen to around 155, but it has since gradually weakened as the impact of the operation faded. According to Scott Bessent, US Treasury Secretary, 'You can give market signals with intervention, but it's policy that turns it'.