The Japanese yen strengthened nearly 1% against the U.S. dollar on Monday, extending the sharp gains recorded last week as market participants anticipate further coordinated intervention by Japanese and U.S. authorities. By 01:38 GMT the USD/JPY pair was 0.8% lower at 156.32 yen, having touched a session low of 155.21 yen earlier in the day. The currency had fallen more than 3% over the preceding two trading sessions after Tokyo confirmed its first joint yen‑buying intervention with Washington since 2011.
U.S. Treasury Secretary Scott Bessent stated that the United States would not hesitate to take part in additional joint intervention should disorderly moves in the yen re‑emerge. President Donald Trump also endorsed the coordinated action, noting that Japan had sought U.S. assistance after the yen’s slide and describing the intervention as beneficial for the global economy.
The yen had previously been under intense pressure, reaching a 40‑year low against the dollar before Japanese authorities intervened in the market last week. The Bank of Japan kept its policy rate unchanged at 1% on the preceding Friday but adopted a hawkish tone, indicating readiness to tighten monetary policy further if inflation evolves in line with its forecasts, thereby providing additional support to the yen.
MUFG analysts described the joint intervention as historic and potentially important for clearing short yen positions in the short term, but cautioned that underlying fundamentals must improve for a durable move lower in USD/JPY. Their global team forecasts that the Bank of Japan will deliver faster rate hikes than currently priced by markets, which they view as a key driver for a longer‑term decline in the USD/JPY exchange rate.