We continue to see a high chance of intervention but only after a break above the 150 level when there is a higher chance of stops fuelling volatility and ‘disorderly’ price action that would provide the justification for the MoF to intervene.

The authorities in China have also upped their rhetoric opposing CNY weakness as well. Actions to curtail upside moves in USD/CNY would certainly help Tokyo in its battle to limit JPY weakness. 

We see the risks still skewed to the upside for both USD/JPY and USD/CNY given the US Dollar momentum but opposition to currency weakness in Tokyo and Beijing remains firm.