Japan is facing an uphill tug-of-war with the shorts of the yen

Analysts say Japan appears to have bought some time and respite for the yen big dump through a series of recent suspicious interventions, but it faces a protracted battle with the yen’s short bearers. Tokyo has not yet confirmed its intervention in the currency market. However, given the large interest rate differentials between the yen and the coins of other major economies, the yen’s pump this week is by no means linear amid the market’s clear shorts on the yen. Rob Canel, head of research at ING Asia-Pacific, said that [the forex intervention] has actually changed nothing, and I think it’s just a moment for the market to pause, but the market will definitely test it again." Caspar Hens, senior portfolio manager at BlueBay Asset Management, said speculators would still hold opposite positions due to the large difference in Intrerest rates.