Japanese Yen Strengthens on Hints of Possible Bank of Japan Rate Hike
The Bank of Japan's December meeting revealed growing confidence among policymakers for a near-term rate increase, while the yen remains near a five-month low against the dollar.
- The Japanese yen rose slightly after Bank of Japan (BOJ) policymakers signaled growing support for a potential rate hike in the near future.
- The BOJ has maintained its interest rate at 0.25%, citing the need to analyze wage trends and the economic impact of the incoming U.S. administration led by President-elect Donald Trump.
- Japan's central bank announced a reduction in monthly Japanese government bond purchases, cutting an additional 410 billion yen starting January 2025.
- The yen remains near a five-month low against the U.S. dollar, which has surged due to elevated U.S. Treasury yields and a hawkish Federal Reserve stance on interest rate cuts.
- Japanese officials, including Finance Minister Katsunobu Kato, have reiterated their readiness to intervene in currency markets to counter excessive yen depreciation.
CNA 