The Japanese yen rose in Asian trading on Thursday against a basket of currencies, attempting to recover from a six-week low against the US dollar and heading toward its first gain in three days, supported by buying activity at lower levels.

The move comes amid growing expectations that the Bank of Japan could take steps to support the local currency, particularly as the yen continues to trade within the intervention zone closely monitored by Japanese monetary authorities.

The US dollar weakened, while oil prices surrendered their gains after a new round of US strikes on Iran concluded and tensions in the Strait of Hormuz eased. Markets are now watching for further developments in the ongoing peace negotiations between Washington and Tehran.

The Price

Japanese yen exchange rate today: The dollar fell about 0.1% against the yen to 160.42, from an opening level of 160.54, after touching an intraday high of 160.56.

The yen ended Wednesday down more than 0.1% against the dollar, marking its second consecutive daily loss and hitting a six-week low of 160.57.

The 160-yen threshold

Japanese authorities are closely monitoring movements in the currency market, particularly after the yen weakened beyond the key 160-per-dollar threshold, a level widely viewed as one that could trigger renewed intervention.

Sources told Reuters that Tokyo intervened several times in late April and early May to halt the yens decline. At that time, the currency had fallen to 160.72 per dollar, its weakest level since July 2024.

Japanese officials have warned against excessive currency volatility and indicated that authorities could take decisive action against disorderly movements in the foreign exchange market.

Finance Minister Satsuki Katayama said the government is "prepared to take appropriate action" if currency markets experience excessive or speculative moves.

Japanese interest rates

Data released on Wednesday showed Japans producer prices accelerating to their highest level in three years as energy costs surged due to the Iran conflict.

Following the data, market pricing for a quarter-point interest rate hike by the Bank of Japan at its June meeting increased from 75% to 95%.

Investors are now awaiting additional data on inflation, unemployment, and wage growth in Japan to reassess those expectations.

The Bank of Japan will meet on June 15-16 to evaluate the appropriate monetary policy tools for the worlds fourth-largest economy.

US dollar

The US Dollar Index fell more than 0.1% on Thursday, resuming losses that were temporarily paused on Wednesday and moving further away from two-month highs, reflecting weakness in the US currency against a basket of major and minor peers.

The decline followed the conclusion of a new round of US strikes on Iran, which are being viewed as part of a pressure strategy aimed at encouraging Iranian authorities to make greater progress in ongoing peace negotiations, potentially paving the way for a final agreement that could reduce tensions and improve stability across the Middle East.

Global oil prices

Global oil prices gave up most of their early gains on Thursday after the United States denied reports that the Strait of Hormuz had been closed to shipping traffic, helping to ease concerns about disruptions to global energy supplies.

Developments in the Iran conflict

The United States launched new airstrikes on Iran for a second consecutive day.

Prior to the attack, President Donald Trump said the United States would carry out a "very strong" strike against Iran.

US Defense Secretary Pete Hegseth said Washington would target "vital facilities."

The attacks represent one of the most serious escalations since the April ceasefire.

Irans Revolutionary Guard said US military bases in Kuwait and Bahrain were targeted with drones and missiles.

Tehran announced the complete closure of the Strait of Hormuz due to security concerns, while Washington denied that the strait had been closed.