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Yen Near 155 as Tokyo Warns and Intervention Bar Rises

Policy signals point to tolerance for yen weakness, raising the bar for direct intervention.

Holograms, which show different images and colours depending on the angle at which they are viewed, are seen on the new Japanese 5,000 yen banknote as the new note is displayed at a currency museum of the Bank of Japan, on the day the new notes of 10,000 yen, 5,000 yen and 1,000 yen went into circulation, in Tokyo, Japan July 3, 2024. REUTERS/Issei Kato/Pool
FILE PHOTO: FILE PHOTO: Japan's new Prime Minister Sanae Takaichi delivers her first policy speech in parliament, in Tokyo, Japan, October 24, 2025. REUTERS/Kim Kyung-Hoon/File Photo/File Photo/File Photo
A man tries to take photos on his smartphone as an electronic screen displays a graph showing Japanese Yen exchange rates surged against the U.S. dollar amid signs of intervention by Japanese authorities in Tokyo, Japan May 2, 2024, REUTERS/Issei Kato/File Photo
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Overview

  • The currency hovered around 154.5–155 per dollar after briefly breaking 155 this week, and it set a record low against the euro near 180.
  • Finance Minister Satsuki Katayama cautioned against “one-sided, rapid” moves and said authorities are watching for disorderly trading with high urgency.
  • Prime Minister Sanae Takaichi has elevated reflationist advisers and favors slower Bank of Japan rate hikes alongside fiscal expansion, a stance that has softened the official tone on defending the yen.
  • Strategists say intervention risk rises on a clear break above 155 or on fast, disorderly moves, but any action would likely aim to slow the slide rather than reverse a trend driven by wide U.S.-Japan rate differentials.
  • Japan last intervened in 2024 near 160, and some analysts now see a higher threshold for action given reserve costs and U.S. sensitivities, with forecasts warning of potential tests toward 160 if fundamentals persist.