- The Japanese Yen (JPY) has fallen to its lowest level since July 2024
- Intervention worries rise
- The US Dollar (USD) rose against major peers
- The war is expected to last for weeks more
The US dollar Japanese yen (USD/JPY) exchange rate rose for a fourth straight day on Friday. The pair rose 0.22% in the previous session, settling on Thursday at 159.80. On Friday at 21:30 UTC, USD/JPY settled at 0.31% at 160.32 and traded in a range of 159.45 to 159.7. The price rose 0.68% across the week.
The U.S. dollar rose across the board. The U.S. Dollar Index, which measures the currency against a basket of major peers, is rose 0.25% to 100.15, extending gains for a fourth day. The USD rose 0.5% across the week.
The yen has weakened sharply as Trump’s efforts to calm markets have failed, and investors grow increasingly concerned about a prolonged conflict that could keep oil and energy prices elevated.
Japan is heavily reliant on imported energy, making it particularly vulnerable to higher prices.
The Strait of Hormuz remains effectively closed, with senior officials from the Islamic Revolutionary Guard Corps reiterating a ban on shipping linked to the US and Israel.
The yen has fallen over 2.7% this month despite a relatively hawkish stance from the Bank of Japan. The central bank’s updated estimates for its neutral rate suggest policymakers are prepared to raise interest rates further to counter inflation.
The Japanese yen has fallen to its lowest level since July 2024, raising the possibility of forex market intervention by Japanese authorities.
Meanwhile, the US dollar has strengthened on safe-haven flows as fears of an intensifying Middle East conflict grow and hopes for de-escalation fade.
US Secretary of State Marco Rubio has said the conflict could last for weeks. The US is also reportedly sending 10,000 additional troops to the region, giving Trump more military options, despite ongoing diplomatic efforts — which Iran continues to deny.