USD/JPY is quoted at 156.68 to 156.96 this morning, Tokyo does not open today, and it does not open tomorrow or Wednesday either. Three consecutive Japanese public holidays close the cash market from 21 to 23 September, and the last thing the Bank of Japan did before the market went away was telephone dealers to ask where the yen was trading. That is the whole setup: the authority that checks rates has a three-session window in which the market it is checking has no domestic bid.
What happened after we last published
Our Friday pre-US piece measured the post-decision move and stopped at about 11:30 UTC. Here is the rest of it, in UTC, because the interesting part happened after we filed.
- 13:15 — US industrial production printed unchanged against a consensus of +0.3%, with manufacturing output down 0.3%. Our Calendar Desk piece this morning takes that apart properly.
- 14:00 — the Conference Board’s leading index printed −0.1% against +0.1% expected, on the same minute as the New York option cut.
- Shortly after 14:30 — the Bank of Japan contacted financial institutions to confirm where the exchange rate was. Market participants described this as a rate check. USD/JPY, which had been in the 157 to 158 area, was back in the upper 156s within about an hour.
Note the order. The dollar made its high for the day somewhere between the 14:00 print and the 14:30 telephone calls, and we cannot tell you which of the two put it there. We are not going to pretend otherwise by picking one.
Two closes, three highs, and a band we got wrong
On Friday we published a range rather than a figure for the day’s high, because our two readers disagreed. We said it was “between 157.33 and a little above 157.80”. The day went through the top of that band. One Tokyo desk puts Friday’s high at 157.96; another puts it at 158.05; a wire report describes the yen as falling as much as 1.2% and “approaching” 158. Our published band was short by at least sixteen pips and possibly by twenty-five.
That is worth saying plainly rather than quietly widening the range. A band is only useful if you are willing to be marked against it, and this one was too narrow because both of the readers we had at 11:30 were describing a session that had not finished.
The close is no cleaner. One Japanese publisher gives 156.60, which is also its low for the session. Another gives 156.88 against a previous close of 155.97, a gain of 91 sen. A third, in English, says the pair closed “around 157”. The two Japanese readers agree exactly on the low — 156.60 — and disagree by 28 pips on where the session finished. We have no way to adjudicate that and no need to: the Kyodo quote at 06:00 JST this morning, 156.68 to 156.96, sits inside the disputed range, so whichever close you prefer, the weekend produced no gap worth the name.
The useful number is not the close. It is the distance from the high: spot is roughly 110 to 130 pips below where Friday peaked, and all of that was given back in the hour after a telephone call.
What “closed” actually removes for three days
The holidays are real and they are primary-sourced. The Cabinet Office lists Respect for the Aged Day on 21 September and Autumnal Equinox Day on 23 September, with 22 September designated a holiday under Article 3, Paragraph 3 of the Holiday Act — the provision that turns a weekday sandwiched between two holidays into a third one. It last applied in September eleven years ago.
What that removes is not “liquidity” in the vague sense. It removes specific, recurring flows:
- The bank fixing. Japanese banks are shut, so the customary Tokyo-morning fixing flow does not occur on Monday, Tuesday or Wednesday. That is our inference from the bank holiday rather than a sourced statement, but it is not a difficult one.
- The cash equity market, and with it the hedging that follows it.
- Not the derivatives. Two readings of the same publisher confirm that Nikkei 225 futures and options continue to trade through the closure. The screen will not be blank; it will be thin and it will be offshore.
Trading resumes on Thursday 24 September. Which brings us to the coincidence that actually matters.
Thursday is the same day twice
The Bank of Japan’s new 1.25% policy rate takes effect on 24 September. We published that from the Bank’s own statement on Friday morning and it has not changed. Tokyo reopens on 24 September. Those are the same day.
So for three sessions the carry does not change, the domestic market cannot express a view, and the first Japanese price that reflects both the new rate and whatever the offshore market did with it prints on Thursday morning. If you run anything that sizes off Tokyo-session behaviour — a range filter, a fixing-time window, an Asia-hours volatility estimate — the next three days will feed it data from a market that is not the one it was calibrated on. The honest response to that is to reduce size or stand down, not to re-parameterise on the fly.
And the intervention question sits on top of it. A holiday closure is the window in which an operation carries the most force per unit spent, because the same ticket moves a thinner book. Tokyo has form this year: a joint operation with the United States was confirmed in early August by Japan’s Ministry of Finance, by the US President and by the Treasury Secretary, and the yen gained as much as 1.4% to 155.20 on the announcement. One reader, citing Bank of Japan data, puts the size of the associated New York operation at just under 59 billion dollars. Another reader says roughly 11.7 trillion yen was deployed after USD/JPY breached 160 during the spring holiday. We have not second-sourced either figure and we are quoting them as one reader each.
What this does not tell you
Whether a rate check precedes intervention. It is widely described as a preparatory step, and the market treated it as one on Friday night. It is not a commitment, and we have no record of any Japanese official confirming that the call was made at all. What we have is market participants saying it happened and the price behaving as though it did.
Even how to label it. Japanese-language readers report the check as conducted. The English-language weekly we read calls it “a suspected rate check”. That is not a translation quibble — it is two different claims about what is known, published the same weekend, and we cannot settle it.
Where the money sits. There is no option expiry board published for 21 September as we write. That is expected — the board appears in the European morning — and it is an absence, not a finding.
A level. One weekly outlook puts this week’s USD/JPY range at 153.00 to 158.00. That is a single publisher, it is five big figures wide, and it contains Friday’s high, Friday’s close and this morning’s quote. It is not a forecast you can size against and we are not presenting it as one.
The Kyodo change figure. This morning’s quote is printed with a day-on-day change of +0.80 yen, and we could not establish which prior quotation that is measured against across a weekend. We used the level and discarded the change.
