The yen has room to weaken more before Japanese officials step in to support the currency, options suggest.
Traders are comfortable pricing yen weakness all the way to ?165 per dollar ¡ª a drop of about 1.6% from the current level, which is already near the weakest in four decades.
A combination of global and local factors are weighing on the currency. In late April, the Japanese government intervened, spending almost $74 billion to prop up the yen, spurring a rebound that proved short-lived. Officials have since issued verbal warnings that they stand ready to act again if needed.
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