The yen fell against the dollar to nearly ¥159, with its approach to the key level reported. The effect of coordinated intervention by Japan and the United States is fading, and concerns about further intervention are said to be mounting.
The yen came under selling pressure in the intraday foreign-exchange market on 10 August, approaching the key ¥159-per-dollar level. It fell 0.7% to ¥158.88, bringing its August decline to 0.9%.
The effect of the latest intervention is said to be fading, and views are spreading that the yen's downward trend will continue despite coordinated intervention by Japan and the United States. Market participants are alert to the possibility of intervention as liquidity is expected to thin during the holiday on 11 August.
Experts cite the interest-rate differential with the United States, Japan's fiscal outlook and geopolitical uncertainty as factors weighing on the yen, while officials from Japan and the United States have warned that they are prepared to intervene again. Goldman Sachs strategists and others are reported to view the effect of intervention as limited because it reflects the fundamental factors behind the yen's weakness.