MUFG Research on this week's wave of Japan's MoF intervention.

"The yen surged yesterday with USD/JPY dropping around 5 big figures from 163.00 to 158.00 before then rebounding. The initial move didn’t catch the eye on a day when the US dollar was weakening more generally but it quickly became clear that this was likely action from the MoF. The scale of the intra-day move following this probable action was similar to moves in previous episodes of intervention. The timing is also similar, at month-end, and will fall into the period in which confirmation will not be published until the end of August," MUFG notes.

"The MoF often acts on a second occasion when intervening and hence there will likely be some reluctance in the market to buy USD/JPY now but there is a risk that buyers will soon return given the lack of conviction from the BoJ on the potential necessity for upping the pace of monetary tightening," MUFG adds.