On the other hand, it is now believed that the Bank of Japan will hold interest rates, in effect, at zero for a prolonged period because of strong political pressure.
Judging from fundamentals for the yen, including strong share prices and relatively positive economic data, the recent fall of the yen is apparently overdone.
While the US Federal Reserve Board is exploring ways to exit from the interest rate-hiking cycle, investors are gaining strong confidence in the strength of Japan's economic fundamentals.
There has been quite strong resistance around 118.20 yen and as the dollar failed to clear that line, it faced selling pressure.