U.S. Dollar Falls Against Yen After Confirmed US-Japan Market Intervention

The U.S. dollar weakened sharply against the Japanese yen after U.S. President Donald Trump and Japan's Finance Ministry confirmed that both countries had jointly intervened in the foreign exchange market, Mayuko Ono and Elaine Kurtenbach reported for The Associated Press (AP).

Currency traders are monitoring the Japanese yen after the United States and Japan confirmed coordinated market intervention.

Before late last week, the dollar had traded above ¥163, reaching its highest level against the yen in about 40 years. Following market speculation that authorities had intervened, the exchange rate fell below ¥160.

Early Monday, after officials confirmed the intervention, the dollar dropped about 1 percent to ¥156.34, marking a significant shift in the currency market.

The yen's prolonged weakness has been a source of concern for Japan because the country imports much of its food, fuel, and raw materials. A weaker yen raises import costs, contributing to higher inflation.

Earlier efforts this year to strengthen the Japanese currency had only a limited impact on exchange rates.