The Japanese yen surged to its highest level in six months, prompting speculation of a coordinated intervention by Japan and the Federal Reserve. This follows Japanese Prime Minister Asumi Takagi's warning about abnormal yen fluctuations, which saw the dollar drop from nearly 160 to 155.6 against the yen. The New York Fed's outreach to major banks suggests potential currency intervention, reminiscent of actions taken in 2008 to inject liquidity into global markets.
Analysts suggest that a coordinated move could prevent the Bank of Japan from selling U.S. Treasury bonds while intentionally weakening the dollar to support the yen. Such a scenario could boost global asset prices, including cryptocurrencies. Bitcoin, which has shown a strong positive correlation with the yen and a negative correlation with the dollar, may benefit from a weaker dollar. Historical data indicates that currency interventions can significantly impact Bitcoin's price, as seen in August 2024 when a Bank of Japan interest rate hike led to a substantial sell-off in cryptocurrencies.
Fed and Japan Signal Possible Yen Intervention, Impacting Bitcoin
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