Dollar is at a high last seen before most of you were born. We’re talking the year Microsoft went public at $21 a share, $777 million market cap.
📉 Yen Breaks Another Record
- The Japanese yen weakened beyond ¥163 per US dollar on Tuesday, its lowest level since 1986. Yes, 1986 — the year Microsoft went public at $21 a share with a market value of roughly $777 million. Some price charts really are time machines.
- The latest move sent as high as ¥163.24, extending a years-long rally powered by higher US interest rates, stronger Treasury yields and fresh geopolitical tensions that pushed investors back into the dollar.
- The pair has now moved well beyond the ¥160 level that previously triggered intervention from Tokyo. The obvious question is no longer if officials dislike these levels — it's whether they're ready to do something about them.
⚠️ Tokyo Is Running Out of Cards
- Japan already spent a record ¥11.7 trillion (about $72 billion) between late April and late May trying to slow the yen's decline. Currency intervention simply means the government buys its own currency and sells foreign currencies in an attempt to influence the exchange rate.
- The problem? Intervention can slow momentum, but it rarely changes the bigger trend if the underlying fundamentals stay the same. Wide interest-rate gaps still favor the dollar, making every yen rally a tempting selling opportunity.
- Finance Minister Satsuki Katayama delivered her strongest warning in weeks, signaling authorities remain ready to act. Lately, though, officials have favored surprise intervention over constant threats — keeping traders guessing instead of giving them a countdown.
⛽ Rates, Oil and Pressure Build
- The latest leg higher came as renewed US-Iran tensions lifted oil prices and Treasury yields. Both developments strengthen the dollar while making life even harder for Japan, which imports most of its energy.
- A weaker yen pushes up import costs, adding pressure to households and businesses already grappling with higher prices.
- That's why every new low in the currency quickly becomes a political issue — not just an opportunity for you to trade a lot or two.