Goldman Sachs on the sharp USD/JPY 'intervention' drop from 150

<p align="left">
This
summary of a Goldman Sachs note is via the folks at eFX.
</p>
<p align="left">
For
bank trade ideas, <a href="https://plus.efxdata.com/ad/track/4655172E54F06040571CD0AB083845AD" target="_blank">check
out eFX Plus</a>.</p>

<p>USD/JPY's Abrupt Movements:</p><p><em>From the end of July, there has been a gradual weakening of the JPY against the USD. However, the trajectory witnessed a sudden twist on October 3 post 11pm JST. After nudging the 150 mark, there was an almost instantaneous retraction to the 147 handle. </em></p><ul><li><em>This abrupt movement was short-lived, with the rate swiftly reverting to the vicinity of 149 within a few minutes. </em></li></ul><p><em>The Enigma of Possible Intervention: </em></p><ul><li><em>Clarification regarding potential interventions remains elusive as neither the Ministry of Finance in Japan nor the New York Fed have shed light on the matter. </em></li><li><em>Contextualizing this with past events, the Japanese authorities notably stepped in to buttress the yen when the USD/JPY touched the 150 level on October 21, 2022. This historical precedent has sowed caution within market circles, prompting them to view the 150 handle as a potentially sensitive intervention (or warning) threshold. </em></li></ul><p><em>Closing Thoughts: </em></p><ul><li><em>Goldman Sachs accentuates the market's sensitivity towards the 150 level in the USD/JPY pair. Given past interventions, market participants are on high alert, interpreting this threshold as a potential intervention cue. It remains imperative to keep tabs on official responses, as they could significantly shape the currency pair's dynamics moving forward.</em></li></ul><p>ICYMI:</p><figure data-media-><img src="https://images.forexlive.com/images/usdyen%20Goldman%20Sachs%20intervention%2006%20October%202023_id_5a99d097-313c-4947-84a5-9e4d65e6545f_size900.jpg" alt="usdyen Goldman Sachs intervention 06 October 2023" width="1093" height="740" wrapper-="wrapper-" data-src="https://images.forexlive.com/images/usdyen%20Goldman%20Sachs%20intervention%2006%20October%202023_id_5a99d097-313c-4947-84a5-9e4d65e6545f_size900.jpg" /></figure>

This article was written by Eamonn Sheridan at www.forexlive.com.