The yen is on track for its biggest weekly loss in more than two months, with the currency approaching 165 per dollar for the first time since May. The decline marks the worst weekly performance since May, driven by persistent dollar strength and speculation that Japanese authorities will tolerate further weakness.

Verbal intervention warnings from Tokyo have done little to deter bearish bets. Finance Minister Masato Kanda and Bank of Japan Governor Kazuo Ueda have repeatedly signaled readiness to act, yet traders continue to sell the yen, encouraged by wide interest-rate differentials between the U.S. and Japan.

The pair traded near 164.90 in New York afternoon, up from around 160 at the start of the week. Analysts say a breach of 165 could trigger actual market intervention, though the Ministry of Finance has not confirmed any operation. The yen’s slide reflects broader risk-on sentiment and expectations that the Federal Reserve will keep rates higher for longer.

Market participants are watching for any sign of coordinated action from Group of Seven nations, but so far only unilateral Japanese rhetoric has been observed. The next key level is 165.15, the 1990 high, which could serve as a line in the sand for policymakers.