USDJPY continues to advance, with the currency pair now up 1.32% on the day. This is the biggest rise since late October, when the pair rose 1.75%.
It’s Golden Week next week and the markets are closed on Monday in Japan.
The Bank of Japan kept rates unchanged. This is what was said which increased the bullish bias of the pair (selling JPY).
At a press conference, Bank of Japan Governor Kazuo Ueda outlined the central bank’s current monetary policy stance as well as considerations for future adjustments. Ueda emphasized that BoJ plans to maintain loose financial conditions for now but indicated that the bank’s future monetary policy will be guided by changing economic conditions and prices, rather than being dictated by a single indicator. He acknowledged that although the Japanese economy has shown a moderate recovery, there are still some weaknesses, and stressed the need to monitor movements in financial markets and foreign exchange markets because of their potential impact on the economy and prices.
Governor Ueda clarified that The BOJ’s policy is not aimed at directly controlling the exchange rate, but it has indicated that it will continue to observe the effects of foreign exchange on the economy and inflation.. Although the weak yen has not significantly influenced trend inflation so far, it has contributed somewhat to higher inflation expectations. Ueda said the likelihood of hitting the BoJ’s 2% inflation target is gradually increasing and adjustments to the degree of monetary easing may be necessary if core inflation rises. He also mentioned that exchange rate fluctuations could be a factor in monetary policy decisions if they significantly affect underlying inflation, even though the impact of currencies on inflation is generally considered temporary. .
“Keep observing” isn’t that scary. Furthermore, the weak yen did not significantly influence the price trend. Inflation is also not scary.
This opened the door for a run to the upside. The 160.00 level is getting closer and closer. The May 1990 swing high reached 160.40.
cnbctv18-forexlive
