The yen's breach of 160 versus the dollar underscores the Japanese currency's vulnerability to further weakness and the heightened risk of authorities entering the market again to slow its decline. While precise thresholds remain uncertain, strategists warned on Monday that potential triggers abound for more intervention to arrest sharp moves weaker, starting as close as 161, followed by the 162-163 zone. They still see little prospect of such action doing more than buying time, with the yen having unwound more than half the gains it made during a record bout of intervention that began in late July.

The latest decline in the currency was fueled by a broad advance in the dollar on Friday on expectations for higher US interest rates, which reinforces the view that much of the movement in the yen is beyond Japan's control. The yen has faced renewed pressure after failing to strengthen beyond 155 following the July intervention, when the US joined Japan in their first coordinated yen-buying operation since 1998.

"For key levels, 161 is the first threshold to watch, followed by the 162.9-163.3 area, where the authorities intervened last time," said Rinto Maruyama, senior rates and FX strategist at SMBC Nikko Securities. Still, the government's approach during the previous episode "placed considerable emphasis on maintaining an element of surprise," meaning authorities could act at any time, he said.

Japan spent a record $96.4 billion over the past month to support the yen after it tumbled to a four-decade low, according to Finance Ministry data. Finance Minister Satsuki Katayama and US Treasury Secretary Scott Bessent have both signaled a willingness to act again if necessary.