The Japanese yen soared by the most in more than two years against the US dollar following massive yen-buying and dollar-selling market interventions in New York markets on Thursday. The currency surged by more than 2 percent, reaching a peak advance of 2.6 percent to 159.21 as of 10:05 am on July 30. This marks the biggest jump since Japanese officials intervened in the market earlier this year.
While authorities refrained from confirming that they intervened in the foreign-exchange market after the sharp rally, they hinted at support from overseas counterparts, including US officials. These actions follow previous warnings from officials that efforts would be made to prop up the currency if it weakened too much or too fast.
The surge comes ahead of a policy decision by the Bank of Japan on Friday. The central bank is widely expected to keep interest rates steady at 1 percent, but it is set to signal its resolve to continue pushing up borrowing costs. This move comes as mounting price pressures from the weak yen and Middle East conflict risk driving underlying inflation above its target.