The dollar reached around ¥163 in summer 2026, and as the yen’s weakening and the dollar’s strengthening have continued, this article explains the risks of foreign-currency assets and the benefits of diversification.
The yen weakened in the foreign exchange market, falling to around ¥163 to the dollar in July 2026. A, who was considering dollar-denominated assets, became concerned after reports of intervention by the government and the Bank of Japan.
The 2026 intervention was disclosed as approximately ¥11.7 trillion in yen-buying intervention from late April through May. The yen surged by more than ¥5 immediately after the intervention, but the effect was short-lived and the yen resumed weakening.
The explanation given was that, despite the intervention, conditions in which the yen is prone to selling have continued in terms of the flow of money, including fiscal and trade factors. One risk is the possibility of an exchange loss when converting back into yen as the yen recovers, although the possibility that the yen will continue to weaken cannot be ruled out.
The benefits of holding foreign-currency assets include the ability to mitigate the impact of a decline in the yen’s value by diversifying across multiple currencies. If the yen continues to weaken, assets may also increase in value when converted into yen, while spreading purchase costs over time is considered effective.