The weakening of the yen is accelerating following the Bank of Japan’s monetary policy announcement.
NHK and Nihon Keizai Shimbun (Nikkei) reported on the 27th that the yen/dollar exchange rate exceeded the 158 yen level for the first time in 34 years.
The yen/dollar exchange rate soared to 158.4 yen per dollar in the New York foreign exchange market during intraday trading on the 26th (local time).
This is the first time since May 1990 that the value of the yen has fallen to the 158 yen per dollar level.
NHK reported, “The decline in the yen accelerated further after the announcement of the results of the Bank of Japan’s financial policy decision meeting.”
In fact, on the day of the 26th, when the Bank of Japan decided to maintain the previous financial policy, including freezing interest rates, at the financial policy decision meeting, the yen/dollar exchange rate in the Tokyo foreign exchange market exceeded the 156 yen level, and after the press conference of Bank of Japan Governor Kazuo Ueda was reported, it fell to 157 yen. I passed it.
Governor Kazuo said at a press conference, “Currently, the weakening yen is not having a significant impact on the basic inflation rate,” adding, “The easing financial environment will continue for the time being.”
This statement, which came as the interest rate difference between the United States and Japan became more highlighted and there was continued movement to sell yen and buy dollars, is said to have accelerated the decline in the yen by giving further weight to the observation that it would be difficult for the Bank of Japan to raise interest rates early.
However, given the recent rapid pace of depreciation of the yen, caution regarding market intervention by Japanese authorities remains.
Nikkei said, “The value of the yen fell by more than 3 yen per dollar this week, showing a rare decline,” and “September and October 2022, when the Japanese authorities intervened in the market, were also times when the yen fell around 3 yen for a week.”
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