LONDON, May 1 (Reuters) - The yen suddenly jumped against the dollar on Friday, a day after Tokyo authorities were widely believed to have intervened to prop up the Japanese currency.
The dollar fell by as much as 0.66% to a session low of 155.60 from 157.12 earlier.
The yen rose by as much as 3% on Thursday after an apparent steady stream of official buying pushed the dollar to a low of 155.5 yen from around 158.3 over the course of about an hour, which Reuters and others reported was intervention
by Japanese officials.
It was not clear what was behind Friday's move, but analysts said after Thursday the market would be on edge for any sudden moves in the currency.
Japan's top currency diplomat Atsushi Mimura said earlier on Friday that speculation remained rife, a blunt warning that officials were ready to step back into markets after intervening just hours earlier to support the yen, which has lost 5% in the last three months alone.
The Ministry of Finance was not immediately available for comment.
"Liquidity is thin and people are nervous after yesterday so there is a susceptibility to volatility in the dollar/yen," said Jeremy Stretch, head of G10 FX strategy, CIBC Capital Markets.
"Every time we see a substantial move in the yen there will be questioning about what is driving this given the warnings we have had."
The wide gap between U.S. and Japanese interest rates, together with an expected drop in trading volumes ahead of a holiday stretch have made officials wary of aggressive speculative attacks.
(Reporting by Alun John and Amanda Cooper; Editing by Dhara Ranasinghe)
