The resurgent dollar is threatening to snuff out the nascent rally in the yen, just as speculators had given up on betting against the Japanese currency.

The greenback jumped almost 3% against the yen last week, helped by a spike in Treasury yields as traders readied for hawkish Federal Reserve commentary at their upcoming Jackson Hole symposium. The strength was broad based as the U.S. currency surged against all Group-of-10 peers, but it has put the dollar-yen rate back on track for a push toward the closely-watched ¥140 level.

Renewed strength in the greenback comes just as currency traders were leaning toward the view that the worst of this year’s losses for the yen were behind it. The currency had been pummeled by a widening U.S.-Japan interest-rate gap, soaring oil prices and a weakening of its haven status but mounted a recovery from mid-July as hedge funds covered short positions.