Central Bank Intervention
a.k.a. FX intervention, Currency intervention
When a central bank buys or sells its own currency in the market to push its exchange rate in a chosen direction.
In central bank intervention, a country's central bank (or finance ministry) steps into the forex market with real money. To weaken its currency, it sells it; to prop it up, it buys it using its foreign reserves.
Interventions can be brutal for anyone on the wrong side, with moves of hundreds of pips in minutes. Japan has intervened several times to support the yen. Whether the move lasts depends on whether the policy behind it backs the action up.
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