The Japanese yen approaches the 160 level, with intervention risks returning to market focus.

(1) As Japan resumes trading after the holiday, risks of yen intervention are once again at the center of market attention. Following two consecutive weeks of yen depreciation, the USD/JPY is once more approaching the closely watched 160 level. (2) According to strategists, since the yen continued to depreciate after the Bank of Japan's rate hike in September, the 160 level has again become an important threshold to gauge Japan’s tolerance for a weaker yen. (3) Commonwealth Bank of Australia FX strategist Carol Kong stated that if U.S. Treasury yields continue to rise and the market continues to test Japan’s determination to defend the yen, USD/JPY could soon break above 160. If the exchange rate quickly surpasses this level, the possibility of official intervention will increase significantly, especially considering recent reports of the Bank of Japan conducting “rate checks.”