Yen Soars on Joint Intervention with US

The Japanese yen surged on Monday, reaching its highest level since May 6, after Tokyo confirmed a joint currency intervention with Washington to prop up the local currency. The yen jumped as much as 1.4 percent in Asian morning trading, reaching 155.20 per US dollar.

This sudden strength weighed heavily on Japanese stocks, with the Nikkei plummeting 2.6 percent and the Topix tumbling 3.1 percent. Automakers were particularly hard hit, falling 4.2 percent as Toyota slid 4.6 percent.

The joint intervention has increased the risk of follow-up action, according to Charu Chanana, chief investment strategist at Saxo, making investors more cautious about rebuilding aggressive short-yen positions.