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2026-07-14 11:22:12
[Yen hovers near 40-year low, intervention expectations intertwined with Government Pension Investment Fund (GPIF) activity] 1. On Tuesday in Asian trading, the USD/JPY pair was largely unchanged around 162.35. The yen remains near a 40-year low, with traders highly vigilant about potential further intervention by Japanese authorities. 2. Matthew Ryan, head of market strategy at Ebury, stated that Japanese authorities appear to have slightly increased their tolerance for yen exchange rate fluctuations, but remain highly cautious. He hinted that authorities would not rule out strong intervention should the currency market experience further sharp volatility. 3. On Monday, media reports indicated that Japan has no plans to adjust the asset allocation targets of its Government Pension Investment Fund (GPIF), weakening market expectations for short-term capital inflows into Japanese domestic assets. As a result, the yen weakened against the dollar, while the USD/JPY pair rose approximately 0.43% on Monday. 4. Japanese Finance Minister Satsuki Katayama has repeatedly stated that the government is prepared to take appropriate action on exchange rate fluctuations if necessary. Analysts point out that against the backdrop of a widening interest rate differential between the US and Japan, verbal intervention has limited effect on supporting the yen, and the market is closely watching whether the Japanese authorities will take substantive action.
