Yen Falls Back to 159 Per Dollar as Intervention Gains Fading Quickly

The yen has fallen back to its previous level of 159 per dollar, erasing more than half of the gains made after the joint intervention by the US and Japanese governments last month.

The currency weakened beyond the 160-per-dollar threshold, but still remains above the 162-per-dollar range seen before the intervention. Market participants are now watching whether Japan's government and the Bank of Japan will step in again to prop up the yen.

The joint intervention was aimed at curbing speculative yen selling, but it did not change the underlying structural forces driving the currency lower. Japanese companies continue to buy dollars for real demand, while rising energy prices, especially crude oil, are adding pressure on the yen.