USD/JPY fell to 157.47 on Wednesday, pausing the yen's rally after a historic joint intervention by Japan and the US pushed the pair down nearly 5% over three sessions. Both governments say they stand ready to intervene again, with the pair's next move hinging on further intervention, Bank of Japan policy signals, and global risk sentiment.
USD/JPY fell to 157.47 on Wednesday, pausing the yen's recent strengthening. US Treasury Secretary Scott Bessent reaffirmed Washington's support for Japan following the joint currency intervention between the two countries.
Record intervention drives the yen higher
Over three sessions, the yen appreciated by nearly 5% after coordinated purchases by Tokyo and Washington, marking the largest such operation in decades. Both countries have declared their readiness to intervene again if necessary.
According to the Bank of Japan, Tokyo deployed approximately 5.33 trillion yen during Friday's operations to support the currency. Media reports the previous day indicated intervention volumes had reached a record 8.45 trillion yen.
What drove the yen to four-decade lows
In July 2026, the yen had fallen to four-decade lows, weighed down by rising energy prices, budget risks, and a wide interest rate differential. Real wages in Japan, however, rose for a sixth consecutive month in June, strengthening the case for further rate hikes by the Bank of Japan.
Technical picture points to a pullback first
On the H4 chart, USD/JPY is consolidating around 157.17, a range currently extending up to 157.90. A move lower toward 157.17 is expected today, followed by a move higher to 159.10, a scenario the MACD indicator supports with its signal line below zero and pointing upward.
The H1 chart shows the pair has completed a downward move to 156.22 before rising to 157.90. A move lower toward at least 157.17 is expected next, followed by a rise to 159.10. The Stochastic oscillator points to short-term downside pressure, with its signal line below 50 and falling toward 20.
Tokyo and Washington's next move, along with fresh Bank of Japan policy signals, will decide whether 157.17 holds.
Source: ActionForex
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