Yen Holds Firm After Coordinated US-Japan Intervention

The Japanese Yen has maintained its strength after a coordinated intervention by Japan and the US last week. The USD/JPY pair steadied on Monday, trading around 156.80, down 0.35% on the day. This comes after hitting an intraday low of 155.23, its lowest level since May 6.

Japan's Ministry of Finance confirmed that Tokyo and Washington jointly bought Yen on Friday to counter excessive volatility and disorderly currency moves. The operation came a day after Japan intervened on its own. Reuters reported that the Bank of Japan spent about $58.97 billion on the first intervention, followed by another $36.58 billion during the joint operation with the US.

Japanese Finance Minister Satsuki Katayama and US Treasury Secretary Scott Bessent have both warned that they will not hesitate to conduct further joint intervention if needed. However, analysts at Rabobank highlight that despite the intervention, Japan's loose financial conditions, expansionary fiscal policy, and relatively low interest rates remain a drag on the currency.