TD Securities says a joint US-Japan currency intervention to support the yen now looks increasingly likely.
The firm noted Japan's top currency official, MIMURA, repeatedly mentioned the US in a Wednesday interview, suggesting Tokyo is seeking Washington's backing for coordinated action.
According to TD Securities, a joint intervention would have a much bigger impact than Japan acting alone, with USD/JPY potentially falling by well over the typical 5-yen move seen in past interventions.
The firm also believes MIMURA's comments were a warning to currency traders against pushing USD/JPY beyond the 163 level.
The firm noted Japan's top currency official, MIMURA, repeatedly mentioned the US in a Wednesday interview, suggesting Tokyo is seeking Washington's backing for coordinated action.
According to TD Securities, a joint intervention would have a much bigger impact than Japan acting alone, with USD/JPY potentially falling by well over the typical 5-yen move seen in past interventions.
The firm also believes MIMURA's comments were a warning to currency traders against pushing USD/JPY beyond the 163 level.