Japan’s yen jumped suddenly against the dollar on Thursday, with traders alert to the prospect of intervention from Japan to prop up its stubbornly weak currency and jumpy about a possible new approach to currency-buying from Japanese officials.

Market Reaction

The dollar fell by as much as 0.9% to 161.115 yen and was last trading at 161.58, down 0.6%. Japan’s Ministry of Finance declined to comment.

Traders are speculating that a possible rate check had taken place, which is seen as a possible precursor to intervention. The yen has weakened around 3% against the dollar so far this year, pressured by Japan’s relatively low interest rates.

Japanese officials are abandoning their habit of telegraphing intervention risks, instead signaling a more targeted campaign to squeeze speculators and raise the cost of betting against the battered yen. Officials are also avoiding any suggestion of a specific exchange-rate level that would trigger action.

Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.