26.09.2022
Chicago 12, Melborne City, USA
Business

Japanese Yen Records Minor Reprieve Following BoJ Intervention

The Japanese yen (JPY) reversed from a 24-year low again to the dollar (USD) on Thursday, after Bank of Japan authorities made a move into the foreign exchange market to support the bruised currency for the first time since 1998.

The USD/JPY pair fell to the 140.34 low in the early London session on Thursday, having reached the 145.90 mark (24-year peak) earlier today.

Japanese Yen Rallies Against Other Currencies

The current spread between today’s high and low for the trading pair, a 3.78% spread, would be the widest since June 2016. The yen also trumped other major currencies, including the Australian dollar (AUD) and British pound (GBP), with the AUD/JPY and GBP/JPY pairs are trading down 1.5% at press time.

When asked if the BoJ had taken an intervention towards the single currency, Masato Kanda, the vice finance minister for international affairs, responded in the affirmative, noting: “We have taken decisive action.”

Interestingly, confirmation of intervention came only a few hours after the BoJ announced that it was maintaining its ultra-loose monetary policy stance to support the economy in its policy meeting today. Furthermore, BoJ Governor Haruhiko Kuroda told the press that his organization plans to hold off hiking its interest rates or its dovish policy for as long as possible.

While the BoJ maintains its loose stance, other central banks around the world, especially the US Federal Reserve, are doubling down on quantitative tightening. This political disparity has weighed heavily on the yen for a prolonged period.

Commenting on the outlook of the Asian currency, Derek Halpenny, the head of global markets research at MUFG, noted: “Unless there is a clear shift in the fundamental driving backdrop [the] Japanese yen weaker, the ability to turn the trend is limited.” He added:

“The Ministry of Finance may see this as buying some time and hope that the Fed completes its tightening cycle by year-end, which may help to bring some degree of turn in the trend.”

You can purchase Lucky Block here. Buy LBLOCK

Share with other traders!

administrator
My name is Lawrence. I am one of the most famous forex trading schools. The purpose of creating this project is not only to give working advice on the Forex market, but also to warn beginners from fraudulent projects. Here we publish reviews of all Forex training scam projects, and professionally train those who have just decided to enter this niche.

    Leave feedback about this

    • Rating