The Japanese yen declined recently, trading around 154 per dollar on Tuesday. It stayed near its weakest levels in three weeks as caution prevailed ahead of the upcoming US Federal Reserve policy decision.
Yen weakens ahead of Fed and BOJ policy decisions
The Fed is widely expected to cut interest rates by 25 basis points on Wednesday, but it may signal fewer reductions for 2025 than anticipated. Domestically, Japan's economy minister, Ryosei Akazawa, reiterated that the Bank of Japan and the government will work together on suitable monetary policies. Markets speculate that the BOJ may hold off on an interest rate hike when it announces its decision on Thursday.
BOJ reportedly sees little cost in delaying further tightening
Reports indicated that the central bank sees "little cost" in delaying further tightening, opting to wait for more signs of wage growth before making additional policy adjustments.
