Yen falls back to 160 per dollar, boosting Japan travel purchasing power

  • Yen weakness returned as the currency slipped beyond 160 per dollar during New York trading.
  • NT$100,000 bought approximately ¥497,265 on Aug. 29, ¥23,556 more than on Aug. 3.
  • Japan spent ¥15.3993 trillion intervening in currency markets from July 30 through Aug. 26.

The yen has weakened back beyond 160 per dollar, restoring a more favorable exchange rate for travelers to Japan after the currency briefly strengthened following record Japanese intervention. Bank of Taiwan’s yen spot selling rate was 0.2011 on the morning of Aug. 29, allowing NT$100,000 to buy approximately ¥497,265, or ¥23,556 more than at the Aug. 3 intraday rate of 0.2111. The latest decline followed hawkish remarks from Federal Reserve Chair Kevin Warsh, which lifted expectations for higher U.S. interest rates, strengthened the dollar and widened the appeal of carry trades (borrowing in low-rate currencies to invest in higher-yielding ones). Japan spent ¥15.3993 trillion, or about $96.2 billion, intervening in currency markets from July 30 to Aug. 26, while total spending this year reached about ¥27.13 trillion. Markets are now watching whether Japan and the United States will intervene again and whether the Bank of Japan will raise rates at its meeting next month, with an approximately 80% probability priced in.

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