The recent Japanese yen rally driven by suspected currency intervention appears limited, with TD Securities strategists warning that USD/JPY downside is likely capped near the 153 level. The firm characterizes the intervention-fueled decline as cyclical rather than a fundamental regime shift in the currency pair’s trajectory.
TD Securities analysts are pointing to December as the most probable window for the Bank of Japan’s next rate hike, suggesting no imminent policy support for the yen in the near term. The strategists also express skepticism about sustained coordinated intervention efforts between US and Japanese authorities, undermining prospects for prolonged yen strength.
This assessment comes as traders have been monitoring Japanese officials closely following suspected market interventions aimed at curbing excessive yen weakness. The currency had weakened significantly against the dollar in recent months, prompting verbal warnings and possible action from Tokyo.
FXnCO Insight
Traders should view current yen strength as temporary and position for USD/JPY to find support around 153, with limited downside until December’s potential BoJ policy shift.
Source: FXStreet