Yen Rebound Ebbs After Brief Rally on Outlook for BOJ Rate Hikes

The yen slid beyond 163 per dollar for the first time since 1986, briefly recovering to around 162.70 after a Bloomberg report that Bank of Japan officials are open to raising rates faster than consensus. Money markets now imply around 84% odds of a BOJ rate hike by October, up from 72% earlier. Despite previous intervention of about 71.9 billion dollars between April and May and verbal warnings from officials, the yen continues to face pressure from wide rate differentials, rising oil prices near 100 dollars a barrel, and Japan fiscal concerns, with analysts eyeing 165 as the next level absent stronger action.