USD/JPY Surges Past 160 as Middle East War Fears Drive Dollar Demand

USD/JPY has breached the critical 160 level as the U.S. dollar strengthens on safe-haven demand amid escalating Middle East conflict, pushing the yen to levels that previously triggered Japanese government intervention. Global markets are firmly in risk-off mode, with investors unwinding carry trades and rotating into dollar-denominated assets as concerns over a protracted regional war threaten oil supply routes and global economic stability. The breach of 160 puts Japanese authorities on high alert, with the Ministry of Finance likely preparing coordinated intervention with the Bank of Japan to defend the currency. Historically, the 160 level has served as a firm intervention trigger, and traders should expect heightened volatility around this zone. The dollar's strength is further supported by elevated U.S. Treasury yields as inflation expectations rise on surging energy costs. Near-term resistance for USD/JPY sits at the 160.50-161.00 range, while support from potential intervention could materialize sharply around 158.00-159.00. Traders are advised to reduce position sizes given the acute risk of sudden central bank action.