Yen jumped because Japanese central bank raised interest rate from abt 0 to 0.25% and this caused unraveling of pretty massive carry trade. Carry trade is borr

Yen jumped because Japanese central bank raised interest rate from abt 0 to 0.25% and this caused unraveling of pretty massive carry trade. Carry trade is borrowing money at low interest rate (yen) and converting it into safe money yielding more (dollar). This is not as trivial as borrowing at 0% and investing at 5%, you also need to construct hedges against currency moves (to a certain point), so the profit margin can be low. While 0.2% was a small change, a lot of funds who borrowed yen and converted into dollars started losing money. They wanted to close some trades so needed to buy yen (since they borrowed in yen and have to repay in yen to close the loan). This made yen rise and positions of more funds (who now have to repay more dollars to close yen loans) even more unprofitable as their currency hedges become very expensive. So more funds wanted to close carry trade positions. And so on. This is not the only process that drove yen up, but it's a significant one.