In this video, Gary Thomson explores why the Japanese yen has weakened again after briefly recovering following US-Japan currency intervention, with USD/JPY back above 159.
Key topics covered:
Why the Yen Recovery Faded — The wide US-Japan rate gap continues to weigh on the yen and support carry trades. Geopolitics and Oil — Middle East tensions and higher oil prices are adding pressure on Japan while supporting the dollar. Investment Flows — Strong US investment, particularly in AI, continues to attract capital away from Japan.BoJ Rate Hike Expectations — Markets are increasingly pricing in a potential September rate hike, but could one move be enough to reverse the yen’s trend?Potential Intervention — With USD/JPY above 159, traders are watching for further action from the BoJ and Japanese authorities.Interest-rate differentials, capital flows, geopolitical risks and intervention continue to drive the USD/JPY pair.
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