The yen fell back to the ¥159-per-dollar range in the New York market on 10 August. As concerns spread over its movements following the reversal after the coordinated Japan-US intervention, the view is gaining ground that the intervention's effect has lasted only halfway.
On 10 August, the yen resumed its downward trend against the US dollar, briefly reaching the ¥159-per-dollar range. Since Japan and the United States carried out coordinated intervention on 31 July, the yen again reached a new high in terms of depreciation, but yen-selling pressure strengthened again several days later.
At the end of July, the yen had depreciated to nearly ¥164 per dollar, and the two governments were said to have carried out coordinated intervention to buy yen and sell dollars on a scale estimated to be among the largest on record. Although the yen briefly rebounded to the low ¥155 range after the intervention, many believe that the renewed fall to the ¥159 range has erased roughly half of the ground regained.
The widening Japan-US interest-rate differential, concerns about fiscal policy and dollar purchases for real demand are cited as factors behind the yen's depreciation. The market believes these factors may dilute the intervention's temporary effect and are likely to rekindle downward pressure on the yen over the longer term.