The Japanese yen weakened past 162.5 per dollar on Wednesday, sinking to its lowest level in four decades and fueling speculation that authorities could intervene to support the currency. Traders are watching Friday’s US holiday as a potential opportunity for Tokyo to buy yen, as thinner market liquidity could amplify the impact of any intervention. The yen came under renewed pressure after fresh data highlighted the resilience of the US economy, reinforcing expectations that the Federal Reserve will raise interest rates this year. Meanwhile, investors remain skeptical about the Bank of Japan’s willingness to accelerate policy tightening as it continues its gradual normalization path. Persistent carry trades and sustained safe-haven demand for the US dollar also weighed on the yen. Additionally, Japan’s heavy reliance on Middle Eastern oil imports left its economy vulnerable to potential disruptions in regional energy supplies.