Overview
- USD/JPY traded through 159 to the weakest level since July 2024, keeping the yen near one‑year lows despite official jawboning.
- Finance Minister Satsuki Katayama said U.S. Treasury Secretary Scott Bessent shared concerns over the yen’s “one‑sided” drop, and Tokyo reiterated readiness to take appropriate steps against excessive moves.
- Markets largely shrugged off the warnings, with traders watching the 160 per dollar area and potential low‑liquidity windows as risk points; no direct intervention has been announced.
- Reports that Prime Minister Sanae Takaichi may call a February snap election revived expectations of expansionary fiscal policy, a theme pressuring the currency.
- Equities rallied as the yen weakened, with the Nikkei hitting fresh records above 54,000, while JGB yields climbed to multi‑decade highs, highlighting a widening policy trade‑off.