Bank of America Global Research answers 10 frequently asked questions on the latest wave of JPY intervention.

"The Japanese and U.S. authorities conducted a coordinated FX intervention on 31 Jul. Both governments have acknowledged that the intervention was carried out. While the amount of yen buying by the US may be limited, the signaling effect of this rare, coordinated intervention is significant. We answer 10 frequently asked questions, and take this opportunity to revise down our 3Q26 USD/JPY forecast to 153 from 154 and year-end target to 149 from 152," Bofa notes.

"1. What's the short-term objective? - Break 155

2. What's the long-term goal? - Restore credibility and stabilize JPY

3. What is the significance of coordination? - Remove limit; broader policy response

4. Why did the US join intervention? - Stabilize JGB & UST; correct yen's valuation; more

5. What does the FX intervention imply for BoJ policy? - Potentially faster rate hikes

6. What else can Japan do? - Increase demand for yen assets

7. What's the implication for JPY? - positive; we revise up JPY forecasts

8. What's the implication for JGB? - prefer long 30yr ASW rather than curve trade

9. How is MoF intervention be funded? - Likely involves UST sales

10. What's the implication for USD and EUR rates markets? - Limited," BofA adds.