MUFG: BoJ Hike Alone Won't Break Yen; Intervention Risk Remains

According to MUFG, the Japanese Yen's inability to strengthen despite the Bank of Japan's historic rate hike keeps the risk of currency intervention alive. The yen remains anchored near the 160.00 level against the US dollar, a threshold that has previously prompted BoJ action.

MUFG analysts argue that the BoJ's move alone is not enough to break the 160 barrier, as fundamental drivers such as interest rate differentials and global risk appetite continue to weigh on the yen. The failure to strengthen leaves the BoJ in a position where further intervention may be necessary to prevent excessive depreciation.