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On Monday, January 26, 2026, the Japanese yen delivered a strong rally against the US dollar, pushing the exchange rate sharply lower in a clear display of renewed currency strength.
USD/JPY Takes a Sharp Hit
The USD/JPY pair dropped noticeably during the session, falling around 1.13% to trade near 153.981 yen per dollar as of late afternoon GMT+2. It moved within a daily range roughly between 153.3 and 155.3, continuing the downward push from the end of last week and bringing the rate to some of its firmest levels in over two months.
Dollar Feels the Pain
The US dollar weakened broadly in currency markets, with the yen delivering one of the most significant blows. Growing concerns about possible official steps to steady the exchange rate prompted traders to buy the yen heavily, adding to the pressure on the dollar and contributing to its softer tone across other pairs as well.
Yen Strikes with Force
The yen emerged as the standout performer of the day, lifted by persistent talk that Japanese authorities might act to prevent overly disruptive swings in the market. This speculation drove the yen higher by more than 1% at points, giving it a solid advantage over the dollar. The yen’s advance also put some downward pressure on Japanese stocks, as a stronger currency raised worries about its impact on export businesses and overall economic mood.
Markets Stay on Edge
Trading in Asian and global markets carried a cautious feel, shaped mostly by the yen’s quick and decisive move. Traders kept a close watch for any fresh developments or statements from officials that could guide the currency’s next steps. The fast reversal served as a strong reminder of how rapidly things can change when the idea of government involvement starts gaining traction.
