Sony

Japan is once again fighting for its currency. This time quietly — without loud ministerial statements or dramatic press conferences. But the numbers emerging from banking analytics speak for themselves. According to estimates by Citi, the Japanese government has already spent around 10 trillion yen over the past few weeks buying its national currency. In dollar terms, that is roughly $63 billion. Sixty-three billion dollars disappearing into the foreign exchange market within days — a scale that is hard to comprehend, yet that is the price Tokyo is paying to convince the world that the yen should not be cheap.

The data on current deposits at the Bank of Japan are the breadcrumbs analysts use to trace invisible interventions. The central bank does not loudly announce its actions, but statistics do not lie. On April 30, about 5 trillion yen disappeared from deposits, and between May 1 and May 6 another 5 trillion vanished. Ten trillion in two weeks. These are not random liquidity fluctuations — they are the footprints of the currency regulator’s heavy boots on the sands of the money market.

The trigger for the intervention, as in previous episodes, was the psychological level of 160 yen per dollar. This appears to be the red line Japanese financial authorities cannot tolerate. Once USD/JPY crosses it, alarm bells go off in Tokyo and the intervention machinery swings into action.

After the intervention, the pair obediently fell toward 155 yen. A temporary reprieve bought with billions of dollars. But by the beginning of the current week, the exchange rate had sharply rebounded and climbed back toward 158 yen per dollar. The market, like a stubborn beast, lay down for a moment, caught its breath, and began rising again. This is the...