FX.co ★ Yen Surges for Second Straight Day

The Japanese yen strengthened beyond 157 per dollar on Thursday, advancing for a second consecutive session as traders monitored the market for signs of official intervention and reassessed the likelihood of more aggressive policy tightening by the Bank of Japan (BOJ) this year. The move began late Wednesday during New York trading, fueling speculation that authorities had conducted a rate check, a step that often precedes direct market intervention.

The yen had fallen to its weakest levels in roughly 40 years in late July, pressured by wide interest rate differentials, mounting fiscal concerns, and elevated energy and import costs. That slump came shortly before Tokyo and Washington carried out a joint yen-buying operation.

In parallel, BOJ board member Hajime Takata opened the door to larger-than-usual or consecutive rate increases to rein in mounting inflationary pressures. Governor Kazuo Ueda also indicated that policymakers must pay closer attention to upside risks to prices when setting monetary policy, signaling that a rate hike is likely later this month.