Yen Surges 3% Against Dollar Amid Suspected Intervention

The yen surged against the US dollar on Thursday, with analysts speculating that Tokyo may have intervened in the currency market to prop up its embattled currency. The Japanese finance ministry's foreign exchange division could not be reached for comment, but the size of the yen's move suggested intervention.

The dollar fell by as much as 3% to 158.34 against the yen, down from 40-year highs near 164 yen hit earlier this week. This represents its biggest one-day fall since late 2022.

Currency analysts said that a combination of factors may have provided Japan with an opportunity to support the yen, including month-end positioning, weak US economic data, and the broadly soft dollar. Mizuho Bank senior strategist Masayuki Nakajima noted that previous Japanese currency intervention had been conducted on the day after the Fed meeting.