The Japanese yen slid to its weakest level against the dollar in nearly four decades on Monday, briefly touching 163.24 in New York trading as escalating hostilities between the United States and Iran triggered a flight to safe-haven assets.
The sell-off accelerated in London and New York, where the yen closed at 163.15–25 per dollar, marking its lowest point since December 1986. Market participants grew convinced that Japanese authorities would not intervene over the holiday period, emboldening sellers. Rising oil prices — WTI crude gained two percent to $84.91 a barrel on the Middle East clashes — further weighed on Japan's trade balance, adding to yen weakness. Analysts also pointed to persistent trade deficits and wide interest-rate differentials as structural pressures.
President Trump said Iran was "desperate" for talks but that Washington had no interest until Tehran was ready. The yen also declined against the euro, trading around 186 per euro in New York.