USD/JPY hits all-time high amid probable BoJ intervention

Key points

• USD/JPY hits 160.00 for the first time since IG began tracking prices
• GBP/JPY simultaneously hit 200.00
• Though unconfirmed, it is likely the Bank of Japan repurchased yen to stabilize exchange rates
• Additional buybacks could be imminent, affecting JPY pairs across the board

USD/JPY spiked to 160.00 before sharp reversal

During the Asian session on Sunday night, USD/JPY soared, appreciating over 200 pips to set an all-time high above 160.00. However, within a few hours, the pair experienced a sudden decline of more than 300 pips—a movement suggesting potential intervention by the Bank of Japan.

USD/JPY price history

GBP/JPY simultaneously hit 200.00

In tandem with USD/JPY's notable ascent, GBP/JPY reached the psychologically significant level of 200.00 around 9pm EST Sunday. A similar downturn around midnight added fuel to the speculation of Bank of Japan intervention amidst this sudden volatility.

Did the Bank of Japan intervene in JPY

The remarkable reversal following the yen’s rapid decline likely indicates an intervention by the Bank of Japan to stabilize the yen by purchasing it back in forex markets. At last week's BoJ meeting, the central bank confirmed it would intervene if the yen continued to depreciate at a rapid pace. Official confirmation is pending due to a holiday in Japan today, contributing to heightened market volatility attributable to reduced liquidity.

Whats next for the Japanese yen

Despite USD/JPY receding below 157.00 and GBP/JPY under 197.00, these figures remain high historically. The possibility of the Bank of Japan engaging in further yen buyback interventions looms, as they had to step in on three separate occasions when the yen suffered in 2022.

How to trade Japanese yen

1. Open an account to get started, or practice on a demo account
2. Choose your forex trading platform
3. Open, monitor, and close positions on JPY pairs

Trading forex requires an account with a forex broker like IG. Many traders watch major forex pairs like GBP/USD and USD/JPY for potential opportunities based on economic events such as inflation releases or interest rate decisions. Economic events can produce more volatility for forex pairs, which can mean greater potential profits and losses as risks can increase at these times.

You can help develop your forex trading strategies using resources like IG’s YouTube channel. Our curated playlists can help you stay up to date on current markets and understanding key terms. Once your strategy is developed, you can follow the above steps to opening an account and getting started trading forex.

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