Yen Weakens as Traders Watch Tokyo's Intervention Response

The yen weakened further on Tuesday, slipping past 162 per dollar in early Asian trading as traders pushed the currency lower amid no immediate indication of official intervention. USD/JPY hovered near recent highs, while GBP/JPY traded around 217.09 and EUR/JPY stood at 185.47 after rising 0.5% in the previous session.

MUFG's Lee Hardman said expectations of renewed Bank of Japan intervention during last week's thinner U.S. holiday trading did not materialize, contributing to the yen giving back some of its recent gains. The currency briefly found support last week amid market speculation over a possible shift in Tokyo's intervention approach, although analysts said Thursday's move did not appear to reflect official action.

More broadly, the U.S. dollar remained under modest pressure as investors adjusted expectations for Federal Reserve policy following a weaker-than-expected U.S. jobs report. The euro edged up to $1.1442, while sterling climbed to a two-week high of $1.34005. CBA's Carol Kong said current market pricing may underestimate the Federal Reserve's eventual policy path, even if the timing of future policy adjustments remains uncertain.

Attention now turns to Wednesday's FOMC meeting minutes, although former Federal Reserve Governor Kevin Warsh has previously expressed reservations about relying heavily on forward guidance.

Elsewhere, the Australian dollar held near $0.6955, while the New Zealand dollar edged up to $0.5702.

What's next: Market participants may monitor the FOMC meeting minutes and any developments related to Bank of Japan intervention for further direction in the yen and U.S. dollar.

This article is for general market information only and does not constitute investment advice.