The yen jumped roughly one yen against the dollar in New York trading on September 18, touching the JPY156 level, the Yomiuri Shimbun reported on September 19.

Market participants attributed the move to speculation that the Bank of Japan had conducted a "rate check", canvassing financial institutions on prevailing exchange rates. Such enquiries are widely read as a precursor to currency intervention, and traders are now on guard for yen-buying, dollar-selling operations by the Japanese government and the central bank.

The BoJ decided at its monetary policy meeting on September 18 to raise the policy interest rate to around 1.25%. Higher rates would normally push a currency stronger.

That did not happen. In Tokyo trading on the same day, the yen slid from the early JPY156 range to the mid-JPY157 range by the evening. In New York, the currency weakened further in morning trade, briefly falling to the JPY158 level, before being bought back to JPY156 within a short space of time.

A rate check involves officials asking banks to quote current market levels, a practice that has historically preceded actual intervention in the foreign exchange market by the Ministry of Finance, with the BoJ acting as its agent.