The yen's surge beyond a key threshold against the U.S. dollar has sparked speculation among traders in Tokyo that Japan's $1.6 trillion government pension fund could engage in "stealth intervention" to soften the currency over coming weeks.
Traders said Monday's sharp strengthening in the yen past the Y106 mark against the dollar, alongside further U.S.-China-related volatility in foreign exchange markets, raised the possibility that the Government Pension Investment Fund might discreetly accelerate planned purchases of overseas assets to offset broader yen buying.
If that happened, analysts said, it could point to a new unofficial intervention lever at a time when "jawbone" tactics may prove too weak and formal action risked heavy diplomatic consequences, particularly from Washington. ...
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