Yen Tradesโค Near 155 to the Dollar as Market Eyes Potential Ceiling
Tokyo – The Japanese โyen hovered near the 155-yen levelโข against theโฃ U.S. dollar on Tuesday, as marketโฃ participants assess the impact of recent โฃmonetaryโ policyโ decisionsโ and speculate on potential intervention from โคJapanese authorities.The yen has โfaced sustained depreciation inโ recent months,โ driven by widening interest โrate differentials between Japan โand the โUnited States, and fueledโฃ by expectations surrounding the bank of Japan’s (BOJ) future policy path.
The weakening yen impacts Japaneseโ importers, raising costs for goods โขand possibly contributing to domestic inflation. A โsharply weaker yen โฃalso erodes the purchasing power ofโ Japaneseโ citizens traveling abroad. โฃThe BOJ has maintained its ultra-loose monetary policy despite rising inflation, a stanceโข that contrasts with theโ Federal Reserve’s tightening cycle, contributing to the yen’s decline. The government has repeatedly expressed concern over the yen’s rapid fall, โsignaling a willingness toโ take action to stabilize theโ currency. โฃ
Accordingโค to Yoshio โIguchi, Head โขof Securities markets at Traders, the current 155-yen level is increasingly viewed as a “decent ceiling.”โ He suggests โthat growing anticipation of a Bank of Japan interest rate hike could deter further upward pressure on the dollar. โThe โBOJ โis balancing โthe need โคto support economic recovery with the imperative ofโฃ stabilizing inflation expectations โand โpreventing excessive exchange rate volatility,according to theโ report.
Shinji Kitamura, Editor: Hitoshi Ishida.
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