Japan May Conduct More Yen Intervention and Faster Rate Hikes, Ex-Diplomat Says

What happened

Former top currency diplomat Mitsuhiro Furusawa stated on Aug 14, 2026 that Japan may conduct joint yen intervention "at any time" and signal faster-than-expected interest rate hikes. He noted the yen is "clearly too weak" and hurting the economy. Furusawa believes the BOJ will raise rates in September and likely again in December or January, followed by another hike in the next fiscal year starting April 2027. Markets see a 76% chance of a hike in September, compared with 24% on July 30.

Why it matters

Furusawa emphasized that intervention only buys time and that faster rate hikes are needed to reverse the yen's downtrend. He urged Prime Minister Sanae Takaichi's administration not to hinder the BOJ's rate hikes or fiscal sustainability pledges.