Yen Steadies Near 164 as Energy Slide Cools Pressure; All Eyes on BoJ
A drop in energy prices has given Japanese policymakers breathing room, helping keep USD/JPY below 164.00, MUFG strategist Lee Hardman notes. Markets await the Bank of Japan’s rate decision for any hawkish cues on future policy.
MUFG strategist Lee Hardman noted that declining energy costs have taken some heat off Japanese officials, helping to cap USD/JPY’s advance beneath the 164.00 threshold. The currency pair has been steady as markets price in no immediate change from the Bank of Japan at its upcoming meeting.
Investors are squarely focused on whether the BoJ will deliver hawkish guidance that signals a shift in its ultra-loose stance. Any suggestion of future policy normalization could further underpin the yen.
Traders are also watching for a potential hawkish surprise from the Federal Reserve, which could reintroduce upside risk for USD/JPY. For now, the combination of cheaper energy and cautious BoJ expectations keeps the yen relatively supported.
Source: FXStreet Forex News