LONDON—The Japanese yen briefly fell to a fresh two-decade low on Wednesday after the Bank of Japan stepped into the market again to defend its ultra-low interest-rate policy, drawing a sharp contrast with the United States where bond yields hit new highs.
But the Japanese unit bounced in London trading as increased nervousness around verbal intervention and growing speculation around an impending bilateral meeting between U.S. Treasury Secretary Yellen and her Japanese counterpart prompted traders to trim some short bets.
Still, positioning in the derivatives and currency futures suggest the yen weakness has more room to run.
The BOJ again offered to buy unlimited amounts of Japanese government bonds to check the rise in Japanese 10-year yields, which were butting against its 0.25 percent tolerance ceiling.
…