The Japanese yen strengthened to around 155 per dollar on Thursday, recovering some of the losses from the previous session. However, ongoing uncertainty about the Bank of Japan's future interest rate hikes continued to put pressure on the currency.
Japanese yen rises but BOJ uncertainty persists
BOJ Governor Kazuo Ueda indicated on Monday that any rate increases would be gradual and dependent on economic conditions, but he did not provide a specific timeline for when hikes might begin. Meanwhile, recent verbal interventions from Japanese authorities have had limited impact in easing market concerns, with traders focusing on the 160 level as a potential trigger for further government action.
Focus on Japan inflation
Investors are now awaiting Japan's October inflation data, scheduled for release on Friday, to gain insight into the economic outlook. At the same time, the yen remains under pressure from the US dollar, which is supported by expectations that Trump’s policies could reignite inflation and constrain future rate cuts by the Federal Reserve.
