Skip to navigationSkip to main contentSkip to right columnADVERTISEMENTBy Amanda CooperWed, July 1, 2026 at 12:52 PM GMT+2 3 min readBy Amanda CooperLONDON, July 1 (Reuters) - The dollar hit a 40-year high against the yen on Wednesday as a sharp rise in U.S. Treasury yields boosted the currency ahead of U.S. jobs data that could strengthen the case for a Federal Reserve rate hike this month.The dollar rose as high as 162.84 yen, well above levels that prompted Japanese authorities to intervene a few weeks ago to support the struggling currency. It was last at 162.68 yen, up 0.1% on the day."We believe we are close to potential action," said Chidu Narayanan, head of macro strategy for APAC at Wells Fargo, referring to the likelihood of another intervention."We are at crucial levels, not necessarily in terms of a target spot level, but levels where the (Ministry of Finance) might need to intervene to retain its credibility."Traders see Friday's U.S. public holiday as a potential window for Tokyo to buy yen, with thinner liquidity likely to amplify the impact of any intervention.Japan's top currency diplomat, Atsushi Mimura, said intervention two months ago to support the yen had been effective, and that some U.S. officials had been "supportive" of the move, Bloomberg News reported on Wednesday.Joey Chew, head of Asia FX at HSBC, said Japan's Ministry of Finance appeared more tolerant of yen weakness than in the past. Factors include broad-based dollar strength against major currencies and falling oil prices, which have eased pressure on the Bank of Japan to curb inflation.She said the ministry could also be waiting for a downside surprise in Thursday's U.S. jobs report that might weaken the dollar, or could be "baiting speculative yen positioning to build to even more extreme levels so as to enhance the impact of its intervention".Elsewhere, the dollar gained against a range of currencies, supported by a sharp rise in U.S. Treasury yields.The euro fell 0.13% to $1.1393, after data showed euro zone inflation fell more than expected in June to below 3%, removing some of the pressure on the European Central Bank to raise interest rates. The pound, meanwhile, dipped 0.1% to $1.325. Against a basket of currencies, the dollar steadied at 101.35.A selloff in U.S. Treasuries spilled into a second day on Wednesday, which pushed the benchmark 10-year yield up another 4 basis points to around 4.465%. The yield has risen by nearly 10 basis points so far this week, set for its largest weekly increase in a month.Analysts said there was no clear catalyst for the move, though month-end positioning may have played a role.Terms and Privacy PolicyEU DSA contactPrivacy & Cookie SettingsMore Info