The market is concerned about JPY. Overview for 17.10.2023

The Japanese yen paired with the US dollar is currently undergoing a phase of consolidation near the psychologically significant level. The current USDJPY exchange rate stands at 149.55.

Investors continue to monitor the developments in USDJPY with considerable anxiety. The pair is still very close to the 150.00 yen level, around which interventions to bolster the JPY could begin. Last week, the JPY exchange rate received support, although the exact nature of this support remains unclear. Nevertheless, the USD shows strength and may reach a yearly high again.

In October 2022, the USDJPY rate surpassed the 150.00 mark. At that time, Japanese officials intervened in the currency market by purchasing JPY amounting to 30 billion USD. The impact of this intervention was short-lived.

This time, Japan refrains from commenting on the fluctuations in the national currency rate, which occurred around the same threshold. Some market participants speculate that the monetary authorities could benefit from a further depreciation of the yen. A weaker currency is advantageous for export-oriented companies but brings unfavourable news for anything linked to imports. The outcome appears to depend on the prevailing priorities at any given moment.