The Japanese Yen loses ground as the US Dollar remains stable amid improved Treasury yields.
The JPY could limit its downside as traders expect intervention by authorities.
BoJ data showed that authorities entered the FX market on consecutive trading days last Thursday and Friday.
The Japanese Yen (JPY) extends its losses for the third consecutive session on Wednesday. The USD/JPY pair has received support from a modest rebound in the US Dollar (USD), which is likely influenced by improved Treasury yields.
The US Dollar also received support from a hawkish speech from Federal Reserve (Fed) Board of Governors member Dr. Adriana Kugler on Tuesday. Dr. Kugler indicated that if upcoming data does not confirm that inflation is moving toward the 2% target, it may be appropriate to maintain current rates for a while longer.
Traders remain vigilant amid suspicions of intervention by Japanese authorities. Data released on Tuesday showed that the Bank of Japan (BoJ) entered the foreign exchange market on consecutive trading days last Thursday and Friday.
The current account balance data from the BoJ, released on Tuesday, indicates an anticipated liquidity drain of approximately ¥2.74 trillion ($17.3 billion) from the financial system on Wednesday due to various government sector transactions. This follows an earlier forecast of a ¥600 billion drain, according to Nikkei Asia.
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