Japanese Yen Weakens as Dollar Strengthens
The Japanese yen slumped past 145 per dollar on Thursday, nearing a three-week low as a stronger U.S. dollar weighed on the economy. The dollar gained after the Federal Reserve kept interest rates unchanged and signaled a cautious approach to policy adjustments, warning that President Trump’s tariffs could reignite inflation.
The dollar has also outperformed the yen as a safe haven amid rising geopolitical tensions, with the Israel-Iran conflict fueling concerns about deeper U.S. involvement in the Middle East. Meanwhile, the Bank of Japan kept interest rates unchanged on Tuesday and signaled a slow and measured approach to reducing its balance sheet. BOJ Governor Kazuo Ueda reiterated that the central bank is closely monitoring domestic and global conditions, leaving the door open for future rate hikes if inflationary pressures warrant action.
Source: Trading Economics