Japanese yen jumps after US data; traders still wary of intervention

July 11, 2024 2:03 pm

LONDON (Reuters) – The Japanese yen jumped on Thursday, in a move traders said was most likely the result of dollar selling after a weak reading of U.S. consumer inflation, rather than official intervention from Tokyo authorities.

The more than 2% jump in the yen following the monthly U.S. data release rang alarm bells for a market that was already wary of the risk of Japanese official buying as the currency has recently plumbed 38-year lows.

Two currency analysts told Reuters they thought the move was more likely triggered by options-related activity following the consumer price report, rather than intervention.

The dollar fell as much as 2.1% to 158.3 yen.. It was last trading at 158.78 yen, down 1.84% on the day.

The yen strengthened across the board and the euro was down around 1.2% at 173.26 yen

© Reuters. FILE PHOTO: Holograms, which show different images and colours depending on the angle at which they are viewed, are seen on the new Japanese 10,000 yen banknote as the new note is displayed at a currency museum of the Bank of Japan, on the day the new notes of 10,000 yen, 5,000 yen and 1,000 yen went into circulation, in Tokyo, Japan July 3, 2024. REUTERS/Issei Kato/Pool/File Photo

“It’s certainly a big move but I don’t think we can say it’s anything to do with intervention,” said Societe Generale (OTC:)’s head of corporate research FX and rates Kenneth Broux.

“The US CPI has been a trigger and it’s more about stops being triggered than intervention,” he said.

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