The U.S. dollar reached 160 yen for the first time since July 2024, when Japanese officials last intervened to stabilize the currency.

The dollar rose 0.22% against the yen to 160.15 per dollar, which traders believe could lead to state intervention.
The dollar index rose 0.17% to 100.4, marking its highest monthly gain in nearly a year, as investors prioritize the U.S. currency over conventional havens like gold or government bonds due to the Middle East crisis.

The yen and Japanese government bonds have been under pressure for months as Prime Minister Sanae Takaichi seeks to stimulate the economy through expanded fiscal policy. This complicates the Bank of Japan’s goal of gradually raising rates to control inflation.

The yen has lost nearly 2% against the dollar since the war began, making it one of the worst-performing global currencies last month. This is due to Japan’s shaky public finances and strong reliance on oil imports.

Tokyo authorities have threatened to act to stabilize the yen if it drops excessively. The last intervention occurred in July 2024, when the yen hit a low of 161 per dollar, its lowest since the 1980s.