Investors have favoured the dollar over the yen because the US offers better returns, with the central bank the Federal Reserve continuing to aggressively tighten its monetary policy.

Expectations for more monetary tightening in the US have pushed 10-year bond yields to 4.2% in the US, the highest in 14 years.

There are lingering fears of a dollar-selling intervention by the Japanese currency authorities, following one on Sept 22, the first in 24 years.

But those fears have not stopped investors from testing the yen’s downside.

The BOJ will hold its monetary policy meeting on Oct 27 and Oct 28.

Today, yen bears were handed a fresh incentive to sell the Japanese currency, after Tokyo reported a record trade deficit of ¥11 trillion for the April to September fiscal first half.

Analysts predict that the yen will remain under pressure as demand for dollars is expected to stay strong from Japanese importers.