Japanese yen recovers from eighteen month low following official warnings on currency volatility

The Japanese yen USDJPYstaged a recovery on Wednesday after hitting an 18-month low, as officials in Tokyo warned they would monitor the market closely. The currency strengthened 0.43% against the greenback to 158.46 per dollar on January 14, 2026, recovering from an earlier slide to 159.45, which marked the weakest level for the currency in Japan JPsince July 2024.

Japanese Finance Minister Satsuki Katayama satsuki katayamaissued a verbal warning on Wednesday, stating that officials would take appropriate action against excessive foreign exchange moves without excluding any options. This rhetoric comes as the yen has tumbled on concerns about looser fiscal and monetary policy and rising reflation bets, with expectations for more government spending and higher yields.