In the foreign exchange market on April 26th, the dollar/yen pair fell sharply. The price fell by about 2 yen, from the upper half of 156 yen to the upper half of 154 yen. The photo shows US dollar and Japanese yen banknotes. Photographed in March 2023 (2024 Reuters/Dado Ruvic)
TOKYO (Reuters) – In the foreign exchange market on the evening of the 26th, the dollar suddenly plummeted by about 2 yen to the low 154 yen range. In the market, although this was not an intervention by the government to buy the yen, there was a strong sense of wariness among participants, leading to a temporary concentration of dollar selling.
Shortly after 5 p.m., after Bank of Japan Governor Kazuo Ueda’s press conference ended, the dollar plummeted from a 34-year high of 156 yen to 154.97 yen in about two minutes.
At the beginning of the sharp decline, there was widespread speculation that there had been an intervention to buy the yen, or a “rate check,” in which financial institutions were required to submit rates in preparation for such intervention. However, after that, the dollar quickly rebounded to around 156 yen, and a foreign bank official said, “If it were an intervention or a rate check, it is hard to imagine that the value would return this quickly.” ing.
A person involved in a major bank said, “Amid growing concerns about intervention, it appears that there was a massive sell-off of the dollar at the top, and there seemed to be an instant rush of selling in response.” The dollar is currently at around 156 yen, almost returning to the level before the plunge.
Participants voiced their concerns that the government would intervene in the evening after the Bank of Japan meeting, just as it did on September 22, 2022, when it intervened to buy the yen for the first time in 24 years. At that time, the dollar began to fall sharply after 5 p.m. See more.
Our Code of Conduct: Thomson Reuters “Principles of Trust” New Tab opens new tab
Tags: Dollar plummets dropping yen yenh rush selling due intervention warnings Reuters
