The Japanese yen declined in Asian trading on Tuesday against a basket of major and minor currencies, extending its losses for a second consecutive session against the US dollar and approaching a five-week low. The currency is also nearing the key 160 threshold, a level widely viewed as a trigger point for Japanese authorities to intervene in support of the yen and curb excessive volatility in the foreign exchange market.

Meanwhile, the US dollar maintained its gains against major global currencies as investors remained cautious ahead of further developments in the ongoing peace negotiations between the United States and Iran.

The Price

The Japanese yen exchange rate today: The US dollar rose by less than 0.1% against the yen to 159.72, from an opening level of 159.66, while the session low stood at 159.57.

The yen closed Monday down about 0.3% against the dollar, hitting a five-week low of 159.77 after limited military exchanges between the United States and Iran.

The 160 yen threshold

Japanese authorities are closely monitoring movements in the currency market as the yen approaches the critical 160-per-dollar level, which has long been viewed as a potential trigger for intervention.

According to Reuters sources, Tokyo intervened several times in late April and early May to halt the yens decline. However, the currencys recovery proved short-lived. At the time, the exchange rate reached 159.25 per dollar, its weakest level since April 30.

Japans finance minister

Finance Minister Satsuki Katayama stated on Tuesday that authorities stand ready to intervene in the currency market if necessary, while declining to comment directly on recent yen movements.

Market views and analysis

Masafumi Yamamoto, chief currency strategist at Mizuho Securities, said that if the dollar rises above 160, the risk of surpassing the April 30 high would increase significantly, raising the likelihood of stronger verbal warnings, rate reviews, or direct market intervention.

US dollar

The US Dollar Index rose about 0.1% on Tuesday, holding onto gains for a second consecutive session and reflecting continued strength in the US currency against a basket of global currencies.

The advance comes as investors remain cautious and avoid taking excessive risk while awaiting the outcome of negotiations between Washington and Tehran aimed at ending the conflict and reopening the Strait of Hormuz.

Top News

Lebanon announced a partial ceasefire between Hezbollah and Israel.

Trump said: I had a very productive call with Hezbollah through high-level representatives, and they have agreed to a full ceasefire.

Trump said negotiations with Iran are continuing at a rapid pace.

Trump stated that he is not concerned about oil prices, which surged after reports that Iran may fully close the Strait of Hormuz and suspend negotiations with the United States.

Iran is seeking an end to hostilities on all fronts, along with the lifting of the naval blockade and easing of economic sanctions.

Japanese interest rates

The Bank of Japan will meet on June 1516 to assess the appropriate monetary policy tools for the worlds fourth-largest economy.

Market pricing for a quarter-point rate hike at the upcoming June meeting remains stable at around 60%.

Investors are closely awaiting a speech by Bank of Japan Governor Kazuo Ueda on Wednesday for clues on whether the central bank intends to proceed with a rate increase in June.

Investors will also monitor upcoming Japanese data on inflation, unemployment, and wages to reassess expectations for future monetary policy.