• AUD/JPY pulled back after hitting 104.72, the highest level since July 2024, on Wednesday.
• The Japanese Yen gains support on potential intervention by authorities.
• RBA’s rate-hike expectations in February remain alive as Australia’s inflation remained above the 2-3% range target.

AUD/JPY halts its five-day winning streak. The currency cross is trading around 104.50 after pulling back from 104.72, the highest level since July 2024, reached during the early Asian hours on Wednesday. The currency cross struggles as the Japanese Yen (JPY) receives support, as traders remain focused on potential intervention from authorities.

Japan’s Finance Minister Satsuki Katayama said on Tuesday that the official has a free hand in dealing with excessive moves in the Yen. Her remarks followed comments from top currency diplomat Atsushi Mimura, who emphasized that officials would take “appropriate” action against excessive exchange-rate volatility

On Wednesday, the Bank of Japan’s (BoJ) October 29–30 Meeting Minutes showed that board members agreed rates would continue to rise if economic and price forecasts materialize. Several members noted that the likelihood of these forecasts being realized has increased, though policymakers stressed the need to maintain current policy to further confirm that positive wage-setting behavior remains intact.

The AUD/JPY cross may regain its ground as the Australian Dollar (AUD) continues to gain following the release of the Reserve Bank of Australia’s (RBA) December Meeting Minutes, which indicated that board members are becoming less confident that monetary policy remains sufficiently restrictive.

Australia’s headline inflation rose to 3.8% in October 2025 from 3.6% in September, remaining above the RBA’s 2–3% target range. As a result, markets are increasingly pricing in a rate hike as early as February 2026, with both the Commonwealth Bank of Australia and National Australia Bank projecting a rise to 3.85% at the RBA’s first policy meeting of the year.