Yen Hits New Seven-Month High Amid Rising BOJ Hike Bets

The Japanese yen surged to a seven-month high against the US dollar on Tuesday, reaching as much as 152.89 per dollar in morning trading and surpassing levels reached during Japan's July intervention. The currency has now firmed roughly 4.5% from around 160 yen per dollar early last week.

Traders and analysts attribute the yen's rally to a combination of factors, including bets on a faster pace of Bank of Japan tightening and the potential for Japanese investors to repatriate their funds, unwinding carry trades and U.S. political pressure.

Khoon Goh, head of Asia research at ANZ, noted that when the yen started to move stronger, it triggered stop losses, particularly when breaking key levels. The next key level to watch will be 150.