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A man walks past an electronic board showing the rate of the Japanese yen versus the US dollar along a street in Tokyo on February 14, 2024.

A fresh market projection by the Bank of Japan on Friday hints at a possible intervention of around $22 billion into the currency markets as the country tries to prop up the ailing yen .

The Japanese currency popped 3% against the dollar late Thursday as the market responded to surprisingly soft U.S. inflation data. It was the yen's biggest daily rise since late 2022, according to Reuters, and came as traders were already on high alert for currency intervention by Japanese authorities.

On Friday, daily current account balance data from the Bank of Japan projected that a drain of 3.17 trillion yen ($20 billion) will occur on July 16. Markets are shut Monday July 15 for a public holiday.

This compares to an earlier forecast for a surplus of around 400 billion yen, according to news agencies Nikkei and Reuters, leaving a surprise 3.57 trillion yen ($22.49 billion) gap in the finances. This is expected to have been spent on currency intervention on Thursday, with foreign exchange transactions taking two working days to settle.

Markets analysts speculated that policymakers had used the opportunity of the U.S. inflation data to enter the market.

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