Overview
- The yen slid to about ¥163 per US dollar on Wednesday, July 22, 2026, even after Tokyo's spring campaign of record foreign‑exchange purchases failed to stop the decline.
- Japan's Ministry of Finance spent roughly 11.7 trillion yen, about $72–$73 billion, in late April and early May in a single intervention effort that only briefly slowed the downtrend.
- The Bank of Japan has raised its policy rate to around 1% but the gap with higher US rates keeps the yen carry trade attractive, which means investors borrow yen, buy higher‑yielding assets and push the currency lower.
- Finance Minister Katayama has vowed “bold action,” but IMF guidance bars further multi‑day interventions until November 2026, narrowing the windows where Tokyo can deploy large, sustained FX operations.
- The weak yen raises real costs for Japanese households and firms by inflating import bills, is driving some corporate treasuries to buy Bitcoin and XRP as hedges, and risks disorderly market moves if carry positions unwind suddenly.