BoJ Hikes Rate to 1.00%, Yen Remains Under Pressure – MUFG
MUFG notes the Japanese Yen is little changed after the BoJ's widely anticipated 0.25% rate hike to 1.00%, with USD/JPY still above 160.00. The central bank also paused its QE taper from FY2027 while continuing gradual JGB reductions.
The Bank of Japan raised its benchmark interest rate by 25 basis points to 1.00%, a move that was widely expected by markets. According to MUFG strategist Lee Hardman, the Japanese Yen has barely reacted, with USD/JPY still trading just above the 160.00 level.
In its latest decision, the BoJ also announced a pause in its quantitative easing taper program starting from fiscal year 2027. The central bank will continue reducing its Japanese government bond purchases gradually in the meantime.
MUFG's analysis suggests the gradual tightening path offers limited near-term support for the yen, leaving the currency under continued pressure against the US dollar.
Source: FXStreet Forex News