Japanese Yen flattens against US Dollar, BoJ policy takes centre stage
The Japanese Yen (JPY) trades almost flat against the US Dollar (USD) at around 157.80 during the European trade on Thursday. The USD/JPY pair consolidates as investors shift their focus to the Bank of Japan’s (BoJ) monetary policy announcement on Friday.
On Thursday, the Japanese Yen (JPY) traded almost flat against the US Dollar (USD) at around 157.80. The USD/JPY pair consolidated as investors turned their attention to the Bank of Japan's (BoJ) monetary policy announcement on Friday. Analysts at Commerzbank noted that markets expected "the overnight rate remaining at 1.25%," with no economists surveyed by Bloomberg expecting a hike this week.
The more important question for FX markets, according to Commerzbank, would be what the BoJ signals about December. Recent BoJ communication and the economic backdrop suggested that the next step towards policy normalization was approaching. The BoJ's semi-annual report on risks to the financial system provided additional support, indicating that higher rates should remain manageable for Japanese banks and companies.
This message for FX markets was that financial stability did not appear to be a binding constraint on further policy normalization.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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