Citigroup: Japan may use up to 30 trillion yen for foreign exchange intervention.

Strategists at Citigroup believe that the Japanese authorities may ultimately spend a total of 30 trillion yen on currency intervention, with an estimated 10 trillion yen already spent. Japan's foreign exchange reserves exceed 1.3 trillion US dollars. The Citigroup strategist stated that if the Japanese Ministry of Finance "accepts the fact that the decline in foreign exchange reserves is roughly the same as during the period from 2022 to 2024", then they may need to spend around 30 trillion yen on intervention. However, considering their relationship with the United States, the Japanese Ministry of Finance "will make every effort to avoid directly impacting the US bond market." If intervention measures force the USD/JPY exchange rate to fall below 155, it may "suppress potential demand for Japanese importers to purchase US dollars." Given the improvement in supply and demand dynamics and current intervention measures, the upward momentum of the USD/JPY is weakening, making it difficult to break through the 158-160 range.