The Japanese yen strengthened to around 154 per dollar on Tuesday, recovering from a four-month low, as Japanese authorities increased verbal warnings against excessive forex fluctuations.
Japanese yen strengthens on intervention fears
Finance Minister Katsunobu Kato emphasized that despite the yen's brief rebound, the government would continue to monitor exchange rate movements and take action if necessary. Additionally, MUFG suggested that Japan may expedite interest rate hikes due to ongoing inflationary pressures. However, Bank of Japan Governor Kazuo Ueda stated on Monday that any future rate increases would be gradual, depending on economic developments, though he provided no specific timeline for when these hikes might take place.
Yen down by 10% from September highs
The yen has dropped more than 10% from its September highs amid growing uncertainty about the BOJ's rate-hike plans, with its decline further exacerbated by the dollar's rally, driven by expectations of less aggressive rate cuts from the Fed and "Trump trades."
