The yen fell 1% to a 10-month low of 157.18 per dollar overnight in a slide that began after finance minister Satsuki Katayama said there was no specific discussion on foreign exchange at a meeting with Bank of Japan governor Kazuo Ueda.

The yen is down around 6% since Prime Minister Sanae Takaichi was elected leader of her party, in spite of rising Japanese yields, as markets are uneasy about the scale of borrowing needed to fund her stimulus plans.

“You must either believe that there’s a ‘Sell Japan’ narrative going on, or you take the view that these relationships are no longer stable,” said Vishnu Varathan, Mizuho’s head of research in Asia, referring to how the yen has fallen even while the US-Japan rate gaps have narrowed.

The yen hovered around 157 to the dollar in morning trade, near where it began the year, and traders now figure Japanese authorities may step in somewhere around the 160 mark, or if there are any more sudden moves.

Beyond Japan, the euro, sterling, kiwi and Aussie all fell against the dollar after minutes from October’s Federal Reserve meeting showed “many” participants had already ruled out a December cut, while “several” saw a December cut as likely.

“In Fedspeak, ‘many’ means more than ‘several’, so I think there’s a bit of a hawkish message that’s supporting the dollar,” said Bank of Singapore strategist Moh Siong Sim.

The euro notched about a 0.4% fall overnight and was steady in early trade on Thursday at US$1.1528. Sterling fell about 0.7% to a two-week low of US$1.3043.

The New Zealand dollar dived 1% and touched a seven-month trough of US$0.5591 as the outlooks for interest rates in New Zealand and the US diverge.

A rate cut next week is fully priced in for New Zealand. In the US, expectations for a December cut have fallen below 25%, after being priced as a near-certainty a month ago.

The dollar index rose 0.5% overnight, climbing through its 200-day moving average, and was last up 0.1% at 100.17.