Yen Strengthens as Dollar, Yields Retreat

2026-08-20 01:45 By Jam Kaimo Samonte 1 min. read

The Japanese yen traded near 158 per dollar on Thursday after gaining nearly 1% in the previous session, supported by a sharp decline in the dollar and retreating Treasury yields as the US government moved to contain long-term borrowing costs by expanding its bond buyback program.

The US Treasury Department said it would at least double the size of liquidity-support buyback operations covering securities with maturities from 10 to 30 years, as the recent surge in yields heightened concerns over market liquidity and stability.

Still, the yen remained under pressure over the longer term due to wide interest rate differentials, mounting fiscal concerns and elevated energy and import costs.

Latest data also showed Japan’s trade deficit widened sharply in July as imports surged to a record high on increased crude oil purchases, while export growth remained robust, supported by strong demand for AI-related chips.



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Yen Strengthens as Dollar, Yields Retreat
The Japanese yen traded near 158 per dollar on Thursday after gaining nearly 1% in the previous session, supported by a sharp decline in the dollar and retreating Treasury yields as the US government moved to contain long-term borrowing costs by expanding its bond buyback program. The US Treasury Department said it would at least double the size of liquidity-support buyback operations covering securities with maturities from 10 to 30 years, as the recent surge in yields heightened concerns over market liquidity and stability. Still, the yen remained under pressure over the longer term due to wide interest rate differentials, mounting fiscal concerns and elevated energy and import costs. Latest data also showed Japan’s trade deficit widened sharply in July as imports surged to a record high on increased crude oil purchases, while export growth remained robust, supported by strong demand for AI-related chips.
2026-08-20
Japanese Yen Stays Range-Bound
The Japanese yen traded around 159.5 per dollar on Wednesday, remaining range-bound for more than a week now after giving back about half of the gains made following the joint intervention by Tokyo and Washington at the end of July. The currency continues to face persistent weakness due to wide interest rate differentials, growing fiscal concerns and elevated energy and import costs. On the monetary policy front, traders are increasingly speculating on a Bank of Japan interest rate hike in September to support the yen and curb inflation. Japan’s 10-year bond yield reached 30-year highs this week, reflecting expectations of an imminent BOJ rate increase and mounting fiscal concerns. Meanwhile, the latest data showed core machinery orders in Japan jumped 9.7% in June, exceeding forecasts and pointing to stronger capital spending among companies.
2026-08-19
Japanese Yen Remains Under Pressure
The Japanese yen depreciated past 159.5 per dollar on Tuesday, reversing gains from the previous session amid mounting fiscal concerns and persistent inflationary pressures. The Takaichi administration’s plan to cut the consumption tax on food to 1% for two years has fueled market concerns, as the government has yet to identify an alternative revenue source and the measure is viewed as an ineffective response to inflation that may not deliver lasting price stability. Markets also remained concerned about elevated energy costs, which are weighing on Japan’s oil-dependent economy and currency. Additionally, the yen continued to face pressure from wide interest rate differentials, as surging Japanese government bond yields were offset by a similar rise in US Treasury yields. Meanwhile, traders are increasingly speculating on a Bank of Japan interest rate hike in September to support the yen and curb inflation.
2026-08-18