FX.co ★ Yen Weakens Past Critical 160 Level

The Japanese yen slipped beyond the key ¥160 per dollar level on Thursday, marking its weakest point since July 2024, when authorities last intervened to shore up the currency. Traders have been ramping up short positions in the yen, betting that neither additional interest rate hikes nor official intervention will provide substantial support in the near term.

At its meeting last week, the Bank of Japan left its policy rate unchanged at 0.75%, as policymakers work to balance persistent inflationary pressures against mounting concerns over slowing growth, partly tied to the conflict in the Middle East. Three of the nine policy board members backed a rate increase, and Governor Kazuo Ueda reaffirmed the central bank’s commitment to a gradual tightening path. Nonetheless, the yen continued to weaken.

Meanwhile, repeated verbal warnings from government officials have so far failed to steady the currency. Finance Minister Satsuki Katayama emphasized that authorities stand ready to intervene in the foreign exchange market at any time to support the yen.