Yen Rallies as US Treasury Yields Decline

The Japanese yen attempted to recover from its three-week low against the US dollar on Wednesday, with the currency rising in the European market. The yen's gains were driven by buying from lower levels and growing expectations that monetary authorities in Japan and the United States could intervene again in the foreign exchange market.

The yield on the 10-year US Treasury continued to decline, putting downward pressure on the US dollar ahead of the release of the Federal Reserve's latest meeting minutes. The dollar fell 0.2% against the yen to ¥159.29, from today's opening level of ¥159.60, after reaching a high of ¥159.65.

Monetary authorities in Japan and the United States are closely monitoring the Japanese currency's movements in the foreign exchange market, particularly as the yen approaches the key threshold of ¥160 per dollar once again. The yen has lost around half of its gains following intervention by Japan and the US in late July and early August.