We believe that several factors, such as valuation and momentum, have affected the Japanese government’s decision whether or not to intervene in the FX market. Our model suggests the probability of JPY-intervention this month is at its highest level since August 2010. While large-scale, recurring interventions are unlikely, the likelihood of a one-off JPY-selling intervention may increase toward the end of September, driven by the increased JPY-repatriation by Japanese exporters around fiscal half-year-end.
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BARCLAYS CAPITAL
ECONOMICS RESEARCH | INSTANT INSIGHTS