Market News

(Bloomberg) -- The yen strengthened sharply against the US currency, leaving traders on high alert for the potential that authorities may once again intervene in the foreign-exchange market.

The Japanese currency rallied as much as 1.2% to 158.22 per dollar, a sharp move that's keeping market participants watching for signs that authorities are stepping into the market. It had strengthened earlier in the session after Bank of Japan Board Member Hajime Takata, one of the bank's most hawkish members, left the door open for an outsized interest-rate move as well as back-to-back rate hikes. A gauge of the dollar, meantime, fell 0.3%.

Tokyo and Washington have joined forces to support the yen to a degree unseen in decades, raising the stakes for anyone betting against the currency. Their first coordinated yen-buying operation since 1998 sparked a rally of about 5% from the weakest level in around four-decades near 164 per dollar, with both governments signaling further joint action if needed.