Yen Intervention Unravelling Amid Rapid Decline
Nigel Green, CEO of deVere Group, a leading financial advisory organisation, has warned that the recent US yen intervention is already faltering. The historic move saw the US buy yen for the first time since 1998 alongside Japan, but the swift reversal in the yen's value has undone much of the coordinated action.
The yen has weakened past 159 per US dollar, retracing roughly half its gains from July's joint intervention. This rapid decline is raising concerns about borrowing costs and inflation risk for Japan, as well as threatening to reignite yen-funded carry trades globally.
Green highlighted the Bank of Japan's inaction on the same day as the US intervention as a critical misstep, stating that 'a currency defence that gives back half its gains within weeks is not holding. It is failing in slow motion, and the pace of that unwind is genuinely alarming.'