News & Analyses

Japanese Yen rallies after suspected intervention, eyes on German inflation

Here is what you need to know on Monday, April 29:

The Japanese Yen (JPY) registered impressive gains against its major rivals to start the week on a suspected intervention. The US economic docket will not offer any high-tier data releases on Monday. Germany’s Destatis will release the preliminary Consumer Price Index (CPI) data for February. 

USD/JPY climbed to a multi-decade high above 160.00 in the early trading hours of the Asian session on Monday. After retreating toward 159.50 area, the pair moved sideways near this level for a couple of hours before declining sharply. USD/JPY lost nearly 400 pips in the next hour and was last seen down 1.7% on the day at 155.60. When asked about the market view of an intervention, Japan’s top currency diplomat Masato Kanda declined to comment.

Japanese Yen sticks to strong intraday recovery gains near 155.00 against USD.

Japanese Yen price today

The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the strongest against the US Dollar.

USD   -0.15% -0.21% -0.02% -0.35% -1.56% -0.33% -0.26%
EUR 0.14%   -0.07% 0.13% -0.19% -1.41% -0.18% -0.11%
GBP 0.22% 0.06%   0.20% -0.14% -1.33% -0.12% -0.03%
CAD 0.01% -0.14% -0.20%   -0.33% -1.63% -0.33% -0.27%
AUD 0.35% 0.19% 0.13% 0.33%   -1.19% 0.00% 0.08%
JPY 1.54% 1.38% 1.31% 1.52% 1.17%   1.20% 1.27%
NZD 0.33% 0.18% 0.12% 0.32% -0.01% -1.22%   0.08%
CHF 0.26% 0.11% 0.04% 0.24% -0.10% -1.30% -0.09%  

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote).


Pressured by the decline seen in USD/JPY, the US Dollar Index turned south on Monday and was last seen losing 0.45% on the day near 105.30. Meanwhile, the benchmark 10-year US Treasury bond yield holds steady above 4.6%, while US stock index futures trade modestly higher on the day. On Wednesday, the Federal Reserve will announce monetary policy decisions and the US Bureau of Labor Statistics will release April labor market data on Friday.

EUR/USD closed the previous week in positive territory and continued to edge higher early Monday. At the time of press, the pair was up 0.3% on the day at 1.0722.

GBP/USD registered marginal losses on Friday but regained its traction to start the week. The pair was last seen trading at its highest level in over two weeks at 1.2535.

Gold fell over 2% and snapped a five-week winning streak last week. XAU/USD holds steady early Monday and fluctuates in a tight channel above $2,330.

Japanese Yen FAQs

The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors.

One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The current BoJ ultra-loose monetary policy, based on massive stimulus to the economy, has caused the Yen to depreciate against its main currency peers. This process has exacerbated more recently due to an increasing policy divergence between the Bank of Japan and other main central banks, which have opted to increase interest rates sharply to fight decades-high levels of inflation.

The BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supports a widening of the differential between the 10-year US and Japanese bonds, which favors the US Dollar against the Japanese Yen.

The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.


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