Yen Plunges Past 164, Oil Hits $100 as Global Markets Shudder

The Japanese yen weakened past 164 against the U.S. dollar on Tuesday, a fresh multi-decade low, as surging oil prices pushed crude above $100 per barrel for the first time in months. The moves sent bond yields higher and rattled investors already nervous about inflation. Oil’s rally, driven by supply fears and geopolitical tensions, directly pressures Japan, a major energy importer. Higher fuel costs raise import bills, widening Japan’s trade deficit and accelerating yen selling. In response, Japanese government bond yields rose, reflecting expectations that the Bank of Japan may eventually need to tighten policy. Traders now watch for possible intervention from Tokyo to support the yen, as the 165 level looms as a psychological barrier. The dollar’s strength, fueled by robust U.S. data and higher interest rates, continues to drive the pair higher. For now, the combination of costly oil and a sinking yen creates a painful squeeze for Japan’s economy and global markets alike.