The yen surged Thursday, reaching a one-month high against the U.S. dollar at around 156.34 per dollar, before trading near 157.1, fueled by speculation of possible Japanese intervention and rising expectations for a Bank of Japan rate hike. The currency had crossed the key 160-per-dollar threshold earlier this week, a level that increases the likelihood of intervention. Japan spent a record 15.4 trillion yen ($98 billion) between late July and late August to prop up its currency. Japan’s Vice Finance Minister Atsushi Mimura said authorities were « neither satisfied nor reassured » and remained on « heightened alert. » Japanese investors hold approximately $1.1 trillion in U.S. Treasuries, raising concerns that prolonged yen weakness could prompt them to reduce their holdings.
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