Japanese Finance Minister Satsuki Katayama said she “won’t rule out any options” to counter weakness in the yen, which slipped to a 1-1/2-year low earlier in the week

The yen rallied against the dollar on Friday after Japan’s finance minister floated the possibility of joint intervention with the US to defend the nation’s faltering currency.

Japanese Finance Minister Satsuki Katayama said she “won’t rule out any options” to counter weakness in the yen, which slipped to a 1-1/2-year low earlier in the week.

Markets in Japan are on edge before a pivotal week that will see fiscally dovish Prime Minister Sanae Takaichi dissolve parliament to set up a snap election while the central bank meets on policy. Some Bank of Japan policymakers see scope to raise interest rates sooner than markets expect to contend with the weak yen, sources told Reuters.

As we get very close to intervention, sometimes we see comments around the Ministry of Finance or officials from Japan asking or checking about prices on the yen with counterparties, said ANZ foreign exchange strategist Felix Ryan.

The relevance of those comments comes down to the level of dollar-yen and also how fast it moves within a 24-hour period.

The dollar-yen rate dropped 0.4% to just below the 158 level after Katayama’s latest comments on potentially stepping into the market.

The yen firmed 0.3% to 158.37 per dollar, still poised for a 0.3% decline on the week.

The dollar index, which measures the dollar against a range of currencies, was little changed at 99.34 and on track for a 0.2% gain this week. The euro was steady at $1.1606, while sterling edged up marginally to $1.3381.

The Japanese currency has dropped on expectations that Takaichi may have greater leeway to introduce more stimulus pending a snap election expected early next month.