Japanese authorities said it intervened to counter excessive speculation that was hurting the world’s number three economy.
Yet analysts remained sceptical of the effectiveness of the move, with some suggesting that it was merely the latest political effort to appease struggling Japanese firms.
“We expected it to happen, it happened, the markets moved a bit then moved back,” economist Philip Rush of Nomura told City A.M. “It was a pretty futile gesture in the usual way.”
However, Japanese officials said its currency manipulation would continue. “I don’t think intervention has ceased yet,” warned Fumihiko Igarashi, deputy to finance minister Jun Azumi.
Japan’s previous interventions since September 2010 have failed to prevent the yen from resuming its rally and setting a series of all-time highs against the dollar.
Tokyo’s latest foray followed repeated warnings that its patience with the yen’s strength was wearing thin, and came just days before the Group of 20 leaders’ summit in Cannes, France.
Tokyo is keen to win G20 understanding that a strong yen is one challenge too many for an economy grappling with ballooning public debt and the fallout from Fukushima.