The currency fell to its lowest level since 1990 on Wednesday before recovering slightly after Japan's top monetary officials met to discuss the currency's rapid depreciation and recommended they be prepared to intervene.
The Bank of Japan, the Finance Ministry, and the Japan Financial Services Agency held a meeting at the end of Tokyo trading hours, after which the top currency diplomat, Masato Kanda, stated that he "will not rule out any measures to respond to the faltering FX movement mess”.
Japanese authorities opted to intervene to keep the yen at 151.94 in 2022 and finance minister Shunichi Suzuki on Wednesday adopted the same tone that preceded the intervention, warning that Japan would take "resolute measures" against point movements. excessive money.
The yen has lost more than 7% this year, driven by a wide gap between US and Japanese bond yields, which a small interest rate hike by the Bank of Japan last week did little to change.
Meanwhile, the US dollar is in the process of snapping strong quarterly gains after investors cut their hopes for a big interest rate cut on strong economic data and skepticism from the central bank.
The US dollar index which measures the US dollar against six major currencies was last traded at 104.095, up around 3% so far in 2024.
The main market focus this week will be on the US core inflation figures due out on Friday, although a larger-than-expected jump in US durable goods orders on Tuesday strengthened the US dollar but put further pressure on the yen.
The euro showed little reaction to Spain's slightly less-than-expected rise in inflation in March and traded at $1.0829. The British pound remained steady at $1.2626.
"The US economy has grown much better than most people expected, especially when compared to other parts of the economy," Miller said.
The US Dollar strengthened slightly against the Swedish krona after Sweden's central bank kept interest rates on hold and signaled interest rate cuts in the coming months. It eventually firmed 0.2% to 10.61 krona.
The Swiss franc fell to its lowest level since early November on Wednesday at 0.9066 against the US dollar, down around 0.3%. The Swiss currency has yet to recover from a surprise interest rate cut in Switzerland last week, and is down around 7% this year.
