The yen fell to its weakest level in a year-and-a-half against the dollar on Wednesday on speculation of a snap election that could pave the way for fiscal stimulus, prompting traders to consider the possibility that Japanese officials may step in to prop up the currency.

Japan's financial authorities are getting annoyed about the weak yen. And it's easy to see why. The currency early Wednesday fell to more than 159 per U.S. dollar, leaving it only a few yen shy of its weakest in more than 30 years,

Speculation over snap polls and big spending plans weakens currency, pushing traders to brace for Tokyo’s next move

The yen held onto overnight gains on Thursday but was pinned near 18-month lows as traders remained wary of intervention after strong warnings ahead of an election in Japan that could usher in more fiscal stimulus and keep the currency constrained.

Japanese officials have stepped up warnings against what they describe as excessive and speculative FX moves Read more at The Business Times.

Nikkei 225 hits record highs on snap election speculation whilst USD/JPY approaches 159. Analyse political risks and divergent Japanese market moves.

Japan’s finance minister issued a fresh warning to speculators after the yen weakened to its lowest level against the dollar in 18 months amid reports of a snap general election.

The yen further edged higher against the dollar, but ING said Prime Minister Takaichi’s plan to hold a snap election weakened the likelihood the currency’s valuation would recover.