How Are Mmes. Watanabe Behaving Amidst JPY-Buying Interventions

This report analyzes the behavior of Japanese individual FX traders (Mmes. Watanabe) and their impact on government JPY-buying interventions. It argues that retail JPY-selling absorbed 15-20% of past interventions, creating a battle of attrition for authorities.

Key Takeaways

• 1.Japanese retail investors (Mmes. Watanabe) absorbed approximately 15%–20% of JPY-buying interventions in 2022 and 2024 through short-JPY margin positions.
• 2.Current interventions in the ¥155/$–¥160/$ zone risk becoming a battle of attrition as retail investors often react by buying USDJPY on dips.
• 3.To maximize effectiveness, Japanese authorities likely need to push USDJPY below ¥155/$ to absorb long-term USD hedging demand from SMEs.

Table of Contents

• CITI'S TAKE
• Forex trading by Mesdames Watanabe
• Growth in trading volume by Mmes. Watanabe
• JPY selling by Mmes. Watanabe
• Intervention to buy JPY and Mmes. Watanabe
• Reaction to intervention in 2026
• What should the MoF and Japanese government do?

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