USD/JPY Surges to 158.20 as BOJ Intervention Concerns Mount

USD/JPY has rallied 1.2% to 158.20, marking the highest level since July 2024, as Japan's policy paradox becomes increasingly apparent. The surge highlights growing tension between the Bank of Japan's ultra-loose monetary stance and mounting pressure for intervention to support the weakening yen. Market speculation intensifies around potential BOJ intervention near the psychologically significant 160.00 level, though officials remain publicly committed to their accommodative policy framework. The pair's rapid ascent has been fueled by widening US-Japan yield differentials, with the 10-year spread expanding to 380 basis points. Technical analysis shows overbought conditions with RSI above 72, suggesting potential for near-term consolidation. However, fundamental drivers remain intact, with traders closely monitoring any verbal intervention from Japanese authorities that could trigger sharp reversals in the pair's trajectory.