The euro slid, while the franc and dollar rose on Monday as investors headed for safety after the U.S. and Israel bombed Iran.
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The U.S. dollar strengthened against the yen on Friday, hitting 160 yen for the first time since July 2024, when Japanese officials last intervened to prop up the currency.
The dollar was last up 0.22% against the yen at 160. 15 per dollar, around levels traders see as a possible trigger for official intervention.
The dollar index was last up 0.17% to 100.4, heading for its strongest monthly gain in almost a year, as the war in the Middle East has prompted investors to seek safety in the U.S. currency rather than in traditional havens like gold or government bonds.
The yen and Japanese government bonds have been under almost unremitting pressure for months, as Prime Minister Sanae Takaichi looks to adopt more expansive fiscal policy as a means of stimulating the economy, thereby complicating the job of the Bank of Japan, which is aiming to gradually raise rates to control inflation.
Since the start of the war, the yen has lost over 2% in value against the dollar, making it one of the worst-performing major currencies in the last month, due to Japan’s fragile public finances and its heavy dependence on energy imports.
Authorities in Tokyo have repeatedly warned they could intervene to prop up the yen if it weakens excessively. They last intervened in July 2024, when the yen reached around 161 to the dollar, its weakest since the 1980’s.
