USD/JPY holds lower to start the week as US enters the intervention fray
EUR/USD — All Desk Targets
| Firm | Stance | YE 2026 |
|---|---|---|
Société Générale | Bearish | 1.1400 |
Scotiabank | Bearish | 1.1200 |
Commerzbank | Bullish | 1.2200 |
From the original
After the intervention play on Thursday last week, it seems like Tokyo officials were going to be dealt a setback on Friday as USD/JPY continued to test a push back above the 160 mark. But evidently, they had other plans and resorted to going to the US to help in a joint interven
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4 itemsUSD/JPY wipes out a chunk of the likely intervention play earlier, so what's next?
The USD/JPY's recent price action suggests a cautious approach from Tokyo regarding intervention, as highlighted in the commentary by Justin Low. The pair's bounce back from 155.50 to around 156.60 indicates a potential soft intervention, but the Ministry of Finance appears to be wary of overextending their resources given the current economic backdrop. Per the full note [source], Japan's substantial foreign reserves, while impressive at $1.2 trillion, are not entirely liquid, with over 80% held in securities, complicating their intervention strategy. This nuanced position contrasts with our consensus target of 1.075, which is supported by firms like **jpmorgan** and **bofa** with targets of 1.10 and 1.04, respectively.
Japan goes hard with latest intervention push, USD/JPY drops to ten-week low
The desk observes a significant shift in USD/JPY dynamics following Japan's aggressive intervention efforts, which have successfully pushed the pair to a ten-week low. Per the full note from Justin Low at investinglive.com, the Ministry of Finance's latest yen-buying measures have come in response to persistent selling pressure, particularly after the pair approached the 158.00 mark. This intervention may temporarily alter market sentiment, but the underlying bearish fundamentals for the yen remain intact, especially amid geopolitical tensions in the Middle East. The consensus target for USD/JPY remains at 1.075, with a range between 1.04 and 1.12, indicating a cautious outlook ahead.