Yen Surges on Hawkish BOJ Bets as Markets Eye US Payrolls

The Japanese yen has been gaining strength against the US dollar in recent trading sessions, and it's now on track for its strongest week in over a month. The currency strengthened to as much as 155.25 per dollar in morning trade, just shy of the 155.20 high it hit last month after the July intervention.

The yen's gain is largely due to bets that the Bank of Japan will be more hawkish than previously expected when it meets on September 17-18. Analysts say this is a key factor in the currency's surge, with some even suggesting that markets are 'cautiously reassessing' a potential BOJ policy shift.

While there has been no official action taken to support the yen, analysts remain cautious due to recent comments from Japan's top currency diplomat Atsushi Mimura. He said he remains alert to exchange-rate moves and is in constant contact with US authorities, leaving markets on high alert for potential intervention.