With the dollar-yen exchange rate on the verge of forming a death cross, attention is focused on its future direction against the backdrop of statements from the Trump administration supporting a stronger yen.
The dollar-yen pair is increasingly likely to form a death cross, with the 50-day moving average expected to fall below the 200-day moving average for the first time since March 2025. The pattern is expected to be confirmed by the end of next week, and the pair fell by approximately 1% through Friday.
Against the backdrop of President Trump’s support for a stronger yen, U.S. Treasury Secretary Bessent has helped drive the move, while Ali Wolrd of Oppenheimer noted that a death cross raises the possibility of a trend reversal. With the breakdown of the long-term uptrend in focus, there are indications of a risk that support near ¥152 will be tested.
Past interventions totaled approximately ¥2.7 trillion from late July through late August, and reached a record monthly level when combined with the ¥11.73 trillion from April and May. The 31 July intervention was a joint operation with the U.S. Treasury, marking the first coordinated intervention since 1998.
In terms of policy and market implications, a stronger yen could curb the competitiveness of U.S. manufacturers, while Japan is emphasizing cooperation aimed at promoting a stronger yen. However, interest-rate differentials and market reactions still prevent the views of the authorities in the two countries from fully aligning, leaving uncertainty over market movements, including whether another intervention will take place.