Yen Set to End Week Little Changed

The Japanese yen traded near 157 per dollar on Friday and was set to end the week little changed, as intervention fears and fresh verbal warnings from Tokyo failed to sustain the recent rally. Japan’s top currency diplomat said on Thursday that the country has no limits on how frequently it can intervene in currency markets and maintains daily communication with US authorities. The yen had initially surged on April 30 amid suspected intervention, with another bout of movement seen on May 6, although the Ministry of Finance has not confirmed any official action in the foreign exchange market. Meanwhile, data showed that Japan’s real wages rose for a third consecutive month in March, reinforcing expectations that the Bank of Japan could continue tightening policy. On the external front, the yen faced renewed pressure from a stronger US dollar as clashes between the US and Iran in the Strait of Hormuz kept geopolitical tensions elevated.

The Japanese yen traded around 156 per dollar on Thursday after rising about 1% overnight, in moves markets largely attributed to suspected intervention from Tokyo. The Ministry of Finance has not confirmed any official action in the foreign exchange market, though Finance Minister Satsuki Katayama recently warned of “decisive measures” against speculative trading, keeping authorities on high alert during the Golden Week holidays. The yen had initially surged as much as 3% on April 30 ahead of the holiday period, before easing back amid a lack of sustained policy follow-through. Externally, the currency also drew support from a weaker US dollar, as expectations of a potential US-Iran agreement to end the war reduced safe-haven demand for the greenback. At the same time, a sharp drop in oil prices helped ease inflation concerns, lowering expectations that the US Federal Reserve would need to adopt a more restrictive interest rate stance.

The Japanese Yen touched 155.49 against the USD, the highest since February 2026. Over the past 4 weeks, US Dollar Japanese Yen lost 2.51%, and in the last 12 months, it increased 8.2%.