June 4 (Reuters) - Markets should consider the risk of a double whammy from a Bank of Japan interest rate hike at the June 15-16 Policy Board meeting and possible FX intervention, given signs Prime Minister Sanae Takaichi may be on board for such moves. The prime minister said as much Wednesday, adding to the chorus from Ministry of Finance officials including Finance Minister Satsuki Katayama , . The market believes MOF is merely biding its time, waiting for the right moment, likely when it perceives the market has become sufficiently long USD/JPY and short the yen. USD/JPY has recently traded back to 160.00, touching 160.09 on Wednesday and early in Asia Thursday. The market, sensing heightened intervention risk, has for now resisted pushing USD/JPY higher during the Tokyo trading day. As for the BOJ, Governor Kazuo Ueda's hawkish comments Wednesdayappear to have cemented expectations of a 25-basis-point hike later this month . Ueda failed however to telegraph a move at the July 30-31 meeting, suggesting the government may not be on board for another rate hike so soon after a June tightening. This seems to be the quandary for Japan. In the absence of the BOJ telegraphing more rate hikes sooner rather than later, any MOF-ordered FX intervention would have only a limited and possibly very temporary impact, as was the case at end-April, early May.

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Bank of Japan benchmark interest rate:

Japan has recently had some success with currency interventions:



USD/JPY:

(Haruya Ida is a Reuters market analyst. The views expressed are his own. Editing by Sonali Desai)