BOJ Conducts FX Rate Check, Report Says

The Bank of Japan carried out a 'rate check' on foreign exchange rates earlier today, according to Nikkei. Such a move is typically seen as a potential step toward intervention, though it can sometimes serve as a bluff.

The report emerged some time ago, and since then USD/JPY has retreated from 158.00.

According to the report, the calls were made late on the 18th and into the 19th, Tokyo time. The decline in the currency pair highlights market cautiousness, as participants recall that earlier this year intervention occurred late on a Friday. Intervention has also been observed after BOJ meetings, so conditions are currently aligned.

US Treasury Secretary dared the market to buy USD/JPY when it was trading at 153.75 last week and so far, he's been wrong. He did say that he has asymmetric information though and part of that could be the size of the cash pile that Japan is willing to intervene with.