Around this time last year we wrote here on currency intervention in the Japanese Yen. The TL;DR version.

There is a pretty simple reason we don’t see intervention much anymore – it does not work…Intervention is like trying to hold 100 ping pong balls underwater at the same time – sooner or later one will pop up. As long as the BOJ keeps interest rates artificially low and continues yield curve control, the currency will eventually, intervention or not, get blasted. When the Fed is guiding market yields close to 5% and even the Europeans are raising 75bps a meeting, the policy gaps are untenable. Something has to give.

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