So there was a question about whether the move in the yen was due to the strong verbal intervention today, a rate check or actual intervention and it looks like we got our answer.
A report in Nikkei says the Ministry of Finance intervened in the FX market to buy the yen (presumably via selling USD/JPY).
Finance Minister Katayama issued a warning after yen breached 160 to dollar. We are getting closer to taking decisive step in FX market, he said.
The BOJ held rates at 0.75% this week, in line with expectations, but the details tilted mildly hawkish at first glance. The quarterly outlook included a notable upward revision to inflation alongside a downgrade to growth, reflecting the economic drag from the US-Iran conflict. More importantly for FX markets, three board members dissented in favor of a rate hike — an unusually strong signal that briefly lifted the yen.
That move didn’t last.
Governor Kazuo Ueda struck a cautious tone in the press conference, effectively dampening the impact of the dissent. He emphasized the need for more time to assess how geopolitical developments filter through to Japan’s economy and underscored that underlying inflation remains slightly below the 2% target. While the BoJ still expects inflation to settle around 2% in the second half of 2026, Ueda was explicit about the uncertainty around timing, noting there is no clear horizon for the next hike.
That combination — distant normalization and near-term hesitation — is what’s keeping the yen under pressure. In addition, the war in Iran looks like a stalemate with the US turning to a siege and that’s spike oil prices
