Japan warns on yen and yields as fiscal pressure mounts
Japanese officials signaled readiness to intervene as the yen weakened past 160 per dollar and bond yields reached 2.740 percent. The government is balancing potential rate hikes with subsidies and tax freezes intended to offset rising costs.
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Japan officials warned of "decisive measures" on Tuesday after USD/JPY weakened to 160.295. This follows a record 11.7 trillion yen intervention in late April and early May that failed to durably support the currency. Persistent yen weakness increases import costs for households and pressures the central bank to accelerate interest rate hikes.
