30/05/2026

BIZ & FINANCE SATURDAY | MAY 30, 2026

14

Yen back in danger zone as Tokyo remains on alert

More non-Iranian ships crossing Hormuz Strait

LONDON: The proportion of vessels not linked to Iranian ownership that are transiting the key Strait of Hormuz has risen, according to data from maritime firm Lloyd’s List Intelligence shared Thursday. This despite Iran blockading the waterway since the start of the Middle East war on Feb 28, preventing a large share of Gulf countries’ hydrocarbon exports, in turn harming the global economy. “The last week we saw ships flagged with Singapore, UAE, South Korea, and also a Norway flagged-vessel going through the Gulf, specifically exiting,“ said Bridget Diakun, an analyst at Lloyd’s List Intelligence. Crossings by very large crude carriers not tied to Iran appear in particular to be picking up again. Of the 27 recorded by analytics firm Kpler since the start of the conflict, more than half took place in May. Five of these huge oil tankers meanwhile left the Gulf through the strait between May 20 and May 26. Three of them – the Eagle Veracruz sailing under the Singaporean flag, as well as the Eagle Verona and the Yuan Gui Yang each flying the Chinese flag – have declared China as their destination. Another ship, the Universal Winner, is heading to South Korea, whose flag it flies, while the Nissos Keros, flying the flag of the Marshall Islands, is headed for India. China, South Korea, India and Japan have coordinated with the Iranian government to ensure safe passage, according to Lloyd’s List Intelligence. On May 18, Iran formalised the creation of the Persian Gulf Strait Authority to manage navigation in the Strait of Hormuz and collect transit fees. The US strongly opposes the new body, with the US Treasury on Wednesday announcing sanctions against the PGSA, while threatening similar action against anyone paying the fees. Such retaliation risks reducing the number of ships exiting the strait in coordination with Iran. Adding to the uncertainty, Iranian forces have fired at four ships attempting to cross the Strait of Hormuz without authorisation, state broadcaster IRIB reported Thursday. It came as the US and Iran accused each other of violating an ongoing truce following an exchange of fire, three months after the Middle East war began with a wave of US-Israeli strikes on the Islamic republic. – AFP

o Investors closely monitoring whether

TOKYO: As Japan’s yen drifts back to levels that prompted official intervention a month ago, markets are sizing up Tokyo’s remaining financial firepower and political will to defend its ailing currency. Japan spent about US$63 billion (RM250 billion) in what were suspected to be multiple bouts of yen-buying intervention at the end of April and early May, a small fraction of its US$1 trillion war chest. But traders think that spending all of that, or even much of it, is unrealistic. And as speculative bets against the yen creep up again, authorities will be looking to keep markets on edge. “The more foreign reserves shrink, the more vulnerable Japan looks to speculators,” said Daisaku Ueno, chief foreign exchange strategist at Mitsubishi UFJ Morgan Stanley Securities. With yen-selling pressure showing no sign of easing, “the war of nerves between the authorities and the market looks set to continue.” Yen-buying intervention requires selling foreign assets, of which Japan held about US$1 trillion at the end of April. After subtracting the roughly ¥10 trillion (RM250 billion) deployed in the April and May actions, based on calculations of Bank of Japan money market data, that leaves about ¥150 trillion, or enough for “around 30 rounds” of intervention, according to Goldman Sachs economist Yuriko Tanaka. But exhausting all of Japan’s foreign assets wouldn’t be feasible, particularly as it would negatively impact the value of US Treasuries at a time when cooperation from the US is critical. The US Treasury conducted so-called authorities will step in again as currency approaches a critical threshold

Markets are watching whether Tokyo will draw a line at ¥160. – UNSPLASH PIX

exchange intervention since April 28. Japanese Finance Minister Satsuki Katayama declined to comment on whether her agency had intervened, repeating that officials were ready to take “decisive action.” The yen has been battered by the three month-long Middle East crisis, with soaring energy prices delivering a terms of trade shock to Japan, which imports almost all its oil. That exacerbated an already weakening trend amid the BOJ’s cautious approach to raising interest rates and expectations of expanded fiscal stimulus under Prime Minister Sanae Takaichi. Whereas previous Japanese administrations have focused on the speed of change in deciding whether to intervene, the current government appears more centred on defending the ¥160 per dollar line. Rather than fearing intervention, some market participants are now positioning for it. A dealer at a domestic bank said buy orders for dollars are clustering in the ¥155 157 per dollar zone, reflecting real dollar demand among importers as well as speculative positions. On the top side, market expectation is that the next intervention will come before the 162 level. – Reuters

“rate checks” that helped nudge the dollar yen rate down in January. “US understanding is crucial” to sustaining the impact of any intervention, said Takeshi Ueno, a senior economist at NLI Research Institute. If Washington were to push back on such activity, it “could invite speculative yen selling.” Another potential check on intervention is an International Monetary Fund (IMF) standard whereby a country that steps into markets too often can risk losing its “free floating” exchange rate status. But chief currency diplomat Atsushi Mimura has said the IMF rules served as no constraint on how many times the government can intervene. “The thinking is that curbing excessive volatility takes priority,” said Akira Moroga, the chief market strategist at Aozora Bank. Even if Japan were to lose its free-floating currency classification, “I don’t think they care at all,” he added. The yen slid to 159.65 on Thursday, the weakest since April 30 when Japan is suspected to have made its first intervention in almost two years. The Finance Ministry is scheduled to announce at 1000 GMT yesterday the total amount spent on foreign

Huawei bets on speed to beat US chip curbs BEIJING: Huawei’s new chip design principle focused on boosting transmission speed rather than continuing to shrink semiconductors offers a path for China to build cutting edge chips despite US sanctions, though whether it represents a true breakthrough remains to be seen. China has been barred since 2019 from importing ASML’s most Its central technique, LogicFolding, aims to arrange logic, analogue and memory circuits in stacked, more tightly connected structures, potentially improving density, efficiency and clock speeds over the next decade. Proponents see it as a way to extend chip progress as manufacturing advances begin to slow. (3D) stacking, advanced packaging and system optimisation. “This is a breakthrough for Huawei, but it’s not a threat for TSMC,“ Nvidia CEO Jensen Huang told reporters in Taipei on Thursday. “TSMC has been using die stacking and 3D packaging for how long now? Almost 10 years. And so TSMC’s technology is very advanced.”

actually go beyond the techniques commonly used in 3D integrated circuit stacking, thanks to “very finely and carefully split the critical paths of logic circuits across multiple layers,“ according to Liao Heng, chief scientist at Huawei Semiconductor. But Bernstein analysts cautioned in a note that while stacking multiple chip layers boosts transistor density, it also increases power density and risks overheating chips. Production yields and costs will be another barrier for adoption, they added. Huawei’s own roadmap also points to those challenges. Huawei’s He said the approach would require new semiconductor design tools suited to folded chip architectures, as well as better ways to manage heat across devices ranging from smartphones to large AI data centres. “With the methodology of not optimising the area on a chip level, but on a system level based on time, that will dramatically change the capability requirements for the EDA (electronic design automation)

vendors,“ said Handel H. Jones, CEO of International Business Strategies, during a panel discussion on Tau Scaling on Tuesday. Mainstream EDA software produced by vendors like Cadence Design Systems and Synopsys plays a crucial role in creating blueprints for sophisticated semiconductor devices. Huawei’s most concrete claims centred on a new Kirin smartphone chip that will be launched later this year, which would be the first to use its LogicFolding architecture. Compared with its earlier single layer design, the new chip would improve power efficiency by 41%, and raise the chip’s peak operating speed by nearly 13%, Huawei’s He said in a speech on Monday. Those figures would be significant if achieved at commercial scale. But Huawei did not provide production yield information, cost comparisons or a clear explanation of how the gains would compare with rival chips made using more advanced process nodes. – Reuters

In the race to build more powerful computing systems, the chip industry has already embraced advanced packaging technologies that stack chips vertically. TSMC has been at the forefront with its packaging technology called SoIC, which enables more tightly integrated heterogeneous chiplets to reduce size and improve performance. Memory chip makers such as SK Hynix and Samsung Electronics also use advanced 3D stacking and packaging technologies to produce multi-layer memory chips, a key component of AI chipsets, and to improve power efficiency and performance. Huawei believes LogicFolding may

“For Huawei, chips face two key constraints. One is inevitable that Moore’s Law will hit a physical ‘wall’ within the next decade,“ He Tingbo, the president of Huawei’s semiconductor business, told China’s People’s Daily this week. “The other is accidental because of the external restrictions that Huawei encountered this ‘wall’ earlier than its peers,“ she said, in a likely reference to US sanctions on importing advanced EUV machines. But others argue that reducing latency has always been part of semiconductor design and that many of the underlying ideas resemble existing work in three-dimensional

advanced extreme ultraviolet (EUV) lithography machines, curbing the ability of its chipmakers to keep up with global leaders like Taiwan’s TSMC in relying on ever-smaller manufacturing processes that make chips more powerful. For decades, the semiconductor industry has been governed by Moore’s Law – the observation that the number of transistors on a microchip doubles roughly every two years. Huawei this week unveiled an alternative approach: cutting the time signals take to move through chips and larger computing systems using a principle it calls the Tau Scaling Law.