The Japanese currency fell to 160.17 per dollar before rising to 155.01 amid speculation of intervention by authorities.
The Japanese yen is trading wildly after falling to a 34-year low against the United States dollar.
The yen fell to 160.17 per dollar on Monday, the lowest level since April 1990, sparking rumors that Japanese authorities could intervene to prop up the currency for the first time since the end of 2022.
The Japanese currency rose to 155.01 later in the day, leading to speculation among traders that authorities had bought the currency to stem the decline.
In Japan, which is observing a public holiday, officials did not confirm any intervention by authorities.
The yen has been on a steady decline since the beginning of 2021 as the Bank of Japan (BOJ) has maintained extremely low interest rates, while the US Federal Reserve and other central banks have increased borrowing costs.
The decline has continued in recent weeks despite the BOJ raising interest rates for the first time in 17 years last month as hopes of a US interest rate cut fade amid above-target inflation.
While the weak yen has helped Japanese exporters boost profits and put more cash in the pockets of tourists visiting Japan, it has also put pressure on domestic budgets by raising prices of imported goods.
Japanese officials have repeatedly said they are prepared to step in to prevent sharp fluctuations in the exchange rate, though officials have refrained from intervening during the currency’s year-long slide.
On Friday, the Japanese central bank kept its benchmark rate unchanged at 0 to 0.1 percent.
BOJ Governor Kazuo Ueda told a news conference that exchange rate volatility would influence monetary policy only if there was a significant impact on the economy.
“If the yen’s moves have an impact on the economy and prices, it is hard to ignore. This may be a reason to adjust the policy,” Ueda said.
