Yen Soars After Joint Intervention, Traders on High Alert
The Japanese yen jumped on Monday after a joint intervention by Tokyo and Washington to shore up Japan's historically weak currency. The yen rose as much as 1% in Asian morning trading, peaking at 155.20 per dollar, its strongest level in about three months.
The yen's jump followed a more than 3% surge over two trading sessions at the end of last week. Japan's finance ministry confirmed it had engaged in joint yen-buying intervention with the U.S. on Friday, while Bank of Japan data showed Tokyo may have bought as much as $58.97 billion worth of yen.
Hirofumi Suzuki, SMBC's chief FX strategist, said that given the magnitude and timing of Monday's move, 'the possibility of intervention cannot be ruled out.' A trader noted a huge unwinding of yen shorts on Monday.