USD/JPY dropped to roughly 155.8 per dollar in early September, its strongest level in five months, after Japan and the United States carried out their first joint currency intervention since 2011. Tokyo's outlays reached roughly $170 billion year-to-date, and traders now price a chance of a Bank of Japan rate hike this month.
USD/JPY surged to about 155.8 per dollar in early September 2026, its strongest reading in five months. That marks a sharp reversal for a currency that had touched roughly 164 per dollar in July, a 40-year low. Japan and the United States responded with their first joint yen-buying operation since 2011, pulling the pair back from the brink.
A record-breaking intervention campaign
Japanese authorities spent ¥15.39 trillion, roughly $100 billion, buying yen during July and August, the largest intervention campaign on record. The Ministry of Finance confirmed about $36.58 billion in the immediate leg of the July operation alone. Outlays in the following month then ballooned to a record $98.7 billion. Including earlier operations, total spending reached roughly $170 billion year-to-date. US Treasury Secretary Scott Bessent described the intervention as "decisive", notable praise given Washington's historical reluctance to publicly back currency operations by trading partners.
Why the yen fell so far
The core driver was an interest-rate gap: the Federal Reserve held rates elevated while the Bank of Japan kept ultra-loose policy, making it cheap to borrow yen and buy higher-yielding dollar assets. Rising energy costs compounded the pressure, since Japan imports most of its fuel and pays for it in dollars. Japan's government debt relative to GDP, the highest among major developed economies, further discouraged investors from holding yen for long stretches.
A policy coalition and a possible BOJ hike
Finance Minister Satsuki Katayama and currency chief Atsushi Mimura have pushed publicly for a yen that better reflects economic fundamentals, and BOJ Governor Kazuo Ueda has signaled openness to policy adjustments. Traders are now pricing a meaningful probability that the BOJ will raise rates at its September 2026 meeting. Even the prospect of a rate hike, regardless of whether it materializes, has helped unwind speculative short positions that had weighed on the yen for months.
What a stronger yen means for markets
USD/JPY fell from the low 160s on September 2 to about 155.83 by September 7, a move of more than five yen in under a week. By early September, though, the pair was still trading between 158 and 160 per dollar by a separate measure, a pullback that has already sparked speculation about whether another round of intervention might be needed. A stronger yen typically pressures Japanese exporters, whose overseas earnings shrink once converted back into a costlier home currency, and the Nikkei 225 tends to move inversely with the currency.
Sources: Crypto Briefing, Crypto Briefing
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