Yen Stuck, Will BOJ Raise Interest Rates Again?
The Japanese yen held steady at around 155.5 per US dollar on Wednesday, after previously weakening. The market is still digesting policy signals from the Bank of Japan (BOJ) after Governor Kazuo Ueda met with Prime Minister Sanae Takaichi. During the meeting, Ueda emphasized that the BOJ is gradually raising interest rates to bring inflation toward its 2% target while maintaining economic growth.
After the meeting, Ueda told reporters that the prime minister had not made any specific requests regarding monetary policy. However, market participants remain divided on the likelihood of another interest rate hike in December. Some believe the BOJ is seriously considering exiting its ultra-loose policy, while others believe the central bank will remain cautious as Japanese economic data has not been entirely robust.
Data-wise, Japanese machinery orders rose more than expected in September, indicating that corporate capital spending remains quite healthy. Despite this, the yen remains trading near its lowest level in ten months. One reason is the expectation that the new government will implement large-scale fiscal spending, which could put additional pressure on the currency. As a result, the yen remains weak for now, while the market awaits clarity on the BOJ's next steps. (az)
Source: Newsmaker.id
