USD/JPY at 157.77 After ¥13.8tn Joint US-Japan Yen Intervention

USD/JPY is trading at 157.77 following historic joint US-Japan yen-buying intervention totaling ¥13.8 trillion, the first coordinated effort since 1998. The pair has retreated sharply from its July peak of 163.86, representing a decline of approximately 609 pips. Notably, the intervention was funded using euros rather than US dollars, adding a unique dimension that also impacts EUR/JPY dynamics. The scale of the operation underscores the seriousness with which both governments view excessive yen weakness. Traders are now eyeing two critical levels: the 150.00 psychological support, which would represent a significant yen recovery, and 164.00, which marks the intervention-triggered high. The use of euro reserves rather than dollar reserves is a strategic departure that may reflect coordination with the ECB or a desire to avoid disrupting US Treasury markets. Near-term direction will likely depend on whether markets test the resolve of authorities with renewed selling pressure on the yen, or whether the intervention successfully anchors expectations around current levels.