Japanese Yen Drops To Mid-151.00s Against USD
The Japanese Yen (JPY) continued to weaken against its US counterpart and slumped to a fresh low since July 31, around the 151.75 region during the Asian session on Wednesday (10/23). Uncertainty over the Bank of Japan’s (BOJ) ability to raise interest rates further this year has been a major factor behind the JPY’s recent decline since the beginning of this month. This prompted Japanese officials to issue verbal warnings about potential government intervention, although this did little to help JPY investors. Even risk-off sentiment and Middle East tensions failed to provide any support to the safe-haven JPY.
Meanwhile, the recent rise in US Treasury bond yields to three-month highs supports prospects for a further near-term depreciation move for the lower-yielding JPY. Further, the ongoing US Dollar (USD) rally to its highest level since early August, supported by speculations that the Federal Reserve (Fed) will cut interest rates at a slower pace, suggests that the path of least resistance for the USD/JPY pair remains up. However, market players might refrain from placing any aggressive bets and rather prefer to wait for the release of Tokyo consumer inflation data on Friday for fresh cues on the BOJ’s rate hike plans.
Source: FXStreet
