Report published September 29, 2026
MUFG Daily Update: JPY Continues to Derive Support from Heightened Intervention Threat
MUFG · September 29, 2026
Heightened warnings of intervention from Japanese officials and US Treasury cooperation have helped the Japanese yen outperform other G10 currencies and cap USD/JPY upside. Meanwhile, the Australian dollar slipped below 0.7000 after RBA Governor Bullock signaled policy may now be restrictive enough despite delivering a 25 bps rate hike to 4.60%.
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Finvaulta summarizes MUFG's analysis. Attribute opinions, forecasts, time-sensitive values, and chronology to the issuer and report date; do not treat this page as an independent verification or a current market-data source.
Key Takeaways
- 1.Verbal interventions from Japanese officials and coordination with the US Treasury are driving JPY outperformance and capping USD/JPY upside.
- 2.Strong demand at Japan's 40-year JGB auction and curve flattening indicate higher yields are restoring investor appetite, supporting expectations of faster BoJ policy normalization.
- 3.The RBA raised its cash rate target to 4.60%, but Governor Bullock's comments considering a pause weighed on AUD/USD, pushing it below 0.7000.
Table of Contents
- JPY: Heightened intervention risk helping the yen to outperform
- FLATTER JGB YIELD CURVE & STRONGER JPY
- AUD: RBA delivers another hike but hopes policy is restrictive enough
- KEY RELEASES AND EVENTS
Report data
FLATTER JGB YIELD CURVE & STRONGER JPY
| Metric | Estimate | Context |
|---|---|---|
| USD/JPY intra-day low | 156.51 | Hit an intraday low following official remarks on yen depreciation. |
| 40-year JGB auction bid-to-cover ratio | 3.1 ratio | Highest bid-to-cover ratio since 2020, exceeding the one-year average of 2.67. |
| Market probability of back-to-back BoJ hike next month | ~36%% | Japanese rate market pricing of an October rate hike. |
| RBA policy cash rate target | 4.60%% | RBA hiked rates for the fourth time this year. |
| Iron ore price change | -5%% | Correction lower from highs set earlier in the month. |
Reports in this series
FX Daily Snapshot is shown in chronological order through this edition, published on September 29, 2026.
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