The Japanese yen edged higher in Asian trading on Thursday against a basket of major and minor currencies, attempting to recover from its lowest level in two years against the US dollar. The currency is on track for its first daily gain in five sessions, supported by bargain buying and growing speculation that Japanese authorities may step in to support the local currency.

The US dollar retreated from a three-month high, while oil prices extended losses for a sixth consecutive session after the United States and Iran electronically signed a preliminary peace agreement.

Price action

• USD/JPY today: The dollar fell 0.1% against the yen to ¥160.49, from an opening level of ¥160.62, after touching an intraday high of ¥160.75.

• The yen ended Wednesday down 0.15% against the dollar, marking its fourth consecutive daily loss and hitting a two-year low of ¥160.80, pressured by the Federal Reserve’s hawkish policy meeting.

US dollar

The US Dollar Index slipped 0.2% on Thursday, pulling back from a three-month high of 100.57 points as the greenback weakened against a basket of global currencies.

In addition to profit-taking activity, the dollar is facing pressure from improving risk appetite following the preliminary peace agreement between the United States and Iran.

Global oil prices

Oil prices fell more than 0.5% on Thursday, extending losses for a sixth straight day and hovering near fresh three-month lows after the International Energy Agency warned of a supply surplus next year following the US-Iran agreement.

US-Iran agreement

• The US and Iranian presidents officially signed the preliminary peace agreement electronically.

• Pakistani Prime Minister Shehbaz Sharif said: “I am honored to announce today the electronic signing of the historic Islamabad Memorandum of Understanding between the United States of America and the Islamic Republic of Iran.”

• Sharif confirmed that the formal signing ceremony between the United States and Iran will take place in Switzerland on Friday.

• American and Iranian diplomatic and security delegations have begun arriving at the Bürgenstock resort in Switzerland to finalize the details of the historic draft agreement ahead of Friday’s official signing.

• The Islamic Republic News Agency (IRNA) published photos showing Iranian President Pezeshkian signing the memorandum of understanding between Iran and the United States.

• Iran announced that the historic agreement has officially entered into force.

Intervention zone

Japanese authorities are closely monitoring movements in the currency market, particularly as the yen approaches the ¥161 per dollar level. Trading beyond the key ¥160 threshold is increasingly viewed as a zone that could trigger renewed intervention.

Reuters sources indicated that Tokyo intervened several times in late April and early May to halt the yen’s decline. At that time, the exchange rate reached ¥160.72 per dollar, its weakest level since July 2024.

Japanese officials have repeatedly warned against excessive currency volatility, stressing that authorities are prepared to take decisive action against disorderly market moves.

Finance Minister Satsuki Katayama reaffirmed that the government is “ready to take appropriate action” if currency markets experience excessive or speculative movements.

Japanese interest rates

• Economic surveys continue to point to a 25-basis-point rate hike by the Bank of Japan in December as the most likely scenario.

• Money markets currently price the probability of a quarter-point rate increase at the July meeting at below 25%.

• Investors are awaiting additional data on inflation, employment, and wages in Japan to reassess the outlook for future interest rate moves.

The Canadian dollar weakened to its lowest level in seven months against its US counterpart on Wednesday as investors grew more cautious ahead of the Federal Reserve’s interest rate decision, while lower oil prices continued to weigh on the currency of one of the world’s major energy exporters.

The Canadian dollar fell 0.3% to C$1.4030 per US dollar, or 71.28 US cents, after touching an intraday low of C$1.4036, its weakest level since November.

George Davis, Chief Technical Strategist at RBC Capital Markets, said weakness in the Canadian dollar against the euro, British pound, and Japanese yen helped keep USD/CAD above the 1.4000 level over the past two sessions.

“We’re also seeing some short-covering in the US dollar ahead of today’s Federal Open Market Committee meeting, as market participants reduce risk exposure,” Davis said.

The US dollar edged slightly higher against a basket of major currencies before the conclusion of the Fed’s two-day policy meeting, the first chaired by Kevin Warsh since taking over as Federal Reserve Chair, with investors watching closely for any signs of a more hawkish policy stance.

In energy markets, oil prices rose 0.7% to $76.67 per barrel after President Donald Trump said the newly announced ceasefire agreement with Iran was not yet final and warned that hostilities could resume if he was dissatisfied with the implementation of the deal.

Despite the rebound, oil prices remain down roughly 10% since the start of the week.

“The decline in oil prices has also been a negative factor for the Canadian dollar because it weakens Canada’s terms of trade,” Davis added.

Investors are now looking ahead to Canada’s April retail sales report due on Friday, which could provide additional clues about the outlook for the domestic economy. Economists expect sales to rise 0.6% from March.

In the bond market, Canadian government bond yields were mixed across the curve, with the 10-year yield falling 1.9 basis points to 3.372%.

Gold falls sharply after Fed holds rates steady and signals a hawkish stance

Gold prices declined sharply on Wednesday after investors digested the Federal Reserve’s decision to leave interest rates unchanged at its first monetary policy meeting under new Chair Kevin Warsh.

Spot gold fell 1.03% to $4,285.52 per ounce, while August gold futures declined 0.84% to $4,317.80 per ounce.

Fed signals tighter policy

In its statement following the meeting, the Federal Open Market Committee said: “The Committee decided to maintain the target range for the federal funds rate at 3.50% to 3.75%, in support of the Federal Reserve’s dual mandate.”

The statement added: “Inflation remains elevated relative to the Committee’s 2% objective, reflecting in part supply-side shocks that have pushed prices higher in certain sectors, including energy. The Committee remains committed to restoring price stability.”

Gold came under pressure after the Fed adopted a more hawkish tone on inflation, leaving rates unchanged while removing earlier language that had suggested the possibility of rate cuts in the near future.

Investors generally view higher interest rates for longer as negative for gold, which offers no yield, compared with interest-bearing assets such as government bonds.

US Treasury yields also moved higher following the decision, adding further pressure on the precious metal. The yield on two-year Treasury notes, which is highly sensitive to monetary policy expectations, rose alongside the yield on 10-year Treasuries.

The move coincided with updated Fed projections showing reduced expectations for rate cuts in 2026, while leaving the door open to additional rate hikes should inflationary pressures persist.

The developments come as investors continue to assess the impact of falling oil prices following the US-Iran de-escalation agreement and the extent to which lower energy costs may ease inflationary pressures in the months ahead.

Last year, South Korea’s Qcells set a world record for the efficiency of large-area silicon solar cells, a breakthrough that promised to significantly reduce the size and cost of solar power projects. The company, owned by South Korean giant Hanwha Corp, achieved a conversion efficiency of 28.6% by combining a perovskite light-absorbing top layer with a silicon bottom layer, allowing the cell to capture a broader spectrum of sunlight.

For comparison, most advanced commercial solar panels operate at efficiencies between 21% and 23%, meaning they convert roughly one-fifth of incoming sunlight into usable electricity. More importantly, Qcells achieved its record on a full-size industrial solar cell designed for mass production rather than a small laboratory prototype.

China has now reclaimed the title of the world’s most efficient solar panel manufacturer. Leading Chinese solar giant Trina Solar officially announced a new world record for solar module efficiency, reaching a conversion rate of 29.2% while delivering a record-breaking power output of 907 watts.

A new generation of tandem solar technology

This achievement was made using a tandem perovskite-silicon design, where two different materials are stacked together to capture a wider range of solar radiation. The perovskite layer absorbs higher-energy wavelengths, while the silicon layer captures light that would otherwise pass through unused, enabling the cell to convert a larger share of sunlight into electricity.

Trina Solar also developed a new interconnection architecture between the two layers, reducing energy losses and improving current flow throughout the cell, helping push efficiency to unprecedented levels.

Like the previous Qcells record, Trina’s breakthrough was achieved using industry-standard 210-millimeter wafers rather than small laboratory cells. The company reported efficiencies of 29.2% for full-size cells and 32.6% for half-cut cells, demonstrating the technology’s suitability for large-scale commercial manufacturing.

The resulting module produced 907 watts of power, a major leap from Trina’s previous record of 808 watts and well above the output of conventional solar panels currently available on the market.

From laboratory breakthroughs to commercial reality

The achievement marks another step toward large-scale commercialization of perovskite technology. While researchers have delivered impressive laboratory efficiency records for years, the real challenge has been replicating those results on full-size modules suitable for industrial production.

Traditional silicon solar cells are approaching their practical efficiency limits. Tandem perovskite-silicon designs offer a new pathway beyond those limits by capturing a broader spectrum of sunlight and generating more electricity from the same panel area.

The industry’s focus has now shifted toward scaling manufacturing and ensuring that these cells can operate reliably for decades under real-world conditions.

Why perovskite matters

Perovskite refers to a class of materials that share a distinctive crystal structure. Solar cells built with these materials can convert a broader range of sunlight into electricity than conventional silicon cells.

Perovskite can also be layered directly onto traditional silicon cells in so-called tandem designs, allowing the technology to absorb wavelengths that silicon cannot effectively utilize. As a result, the theoretical efficiency ceiling can exceed 40%.

Another advantage is flexibility. Perovskite can be applied in ultra-thin layers, making it possible to print or spray the material onto flexible films, windows, and even curved building surfaces.

Unlike silicon, which requires energy-intensive manufacturing processes and extremely high temperatures, perovskite materials can be processed into printable inks at room temperature, potentially lowering production costs substantially.

The remaining challenge

Despite growing commercial progress, perovskite technology has not yet become widely available for residential rooftop installations. One of the biggest obstacles remains durability, as pure perovskite cells tend to degrade relatively quickly when exposed to moisture, heat, and ultraviolet radiation.

Nevertheless, several companies have already begun commercial deployment.

California-based Caelux has developed its Active Glass technology, allowing manufacturers to produce tandem modules using existing production lines without redesigning silicon cells or making major factory modifications.

Meanwhile, UK-based Oxford PV has already started shipping solar modules with efficiencies reaching 24.5% to utility-scale customers across the United States and Europe.

As efficiency records continue to rise, the race is no longer about proving that perovskite works. The next battle will be determining which companies can manufacture it at scale while delivering the long-term durability required to transform the global solar industry.