Japanese Yen Records Minor Reprieve Following BoJ Intervention

Updated:

The Japanese yen (JPY) reversed from a 24-year low again to the dollar (USD) on Thursday, after Bank of Japan authorities made a move into the foreign exchange market to support the bruised currency for the first time since 1998.

The USD/JPY pair fell to the 140.34 low in the early London session on Thursday, having reached the 145.90 mark (24-year peak) earlier today.

Japanese Yen Rallies Against Other Currencies

The current spread between today’s high and low for the trading pair, a 3.78% spread, would be the widest since June 2016. The yen also trumped other major currencies, including the Australian dollar (AUD) and British pound (GBP), with the AUD/JPY and GBP/JPY pairs trading down at 1.5% at press time.

When asked if the BoJ had taken an intervention towards the single currency, Masato Kanda, the vice finance minister for international affairs, responded in the affirmative, noting: “We have taken decisive action.”

Interestingly, confirmation of intervention came only a few hours after the BoJ announced that it was maintaining its ultra-loose monetary policy stance to support the economy in its policy meeting today. Furthermore, BoJ Governor Haruhiko Kuroda told the press that his organization plans to hold off hiking its interest rates or its dovish policy for as long as possible.

While the BoJ maintains its loose stance, other central banks around the world, especially the US Federal Reserve, are doubling down on quantitative tightening. This policy disparity has weighed heavy on the yen for a prolonged period.

Commenting on the outlook of the Asian currency, Derek Halpenny, the head of global markets research at MUFG, noted: “Unless there is a clear shift in the fundamental backdrop driving [the] Japanese yen weaker, the ability to turn the trend is limited.” He added:

“The Ministry of Finance may see this as buying some time and hope that the Fed completes its tightening cycle by year-end, which may help to bring some degree of turn in the trend.”

 

You can purchase Lucky Block here. Buy LBLOCK

  • Broker
  • Benefits
  • Min Deposit
  • Score
  • Visit Broker
  • 20% welcome bonus of upto $10,000
  • Minimum deposit $100
  • Verify your account before the bonus is credited
$100 Min Deposit
9
  • Award-winning Cryptocurrency trading platform
  • 14 Cryptoassets available to invest in
  • FCA & Cysec regulated
$200 Min Deposit
9.8

Highly volatile unregulated investment products. No EU investor protection.

  • Over 100 different financial products
  • Invest from as little as $10
  • Same-day withdrawal is possible
$100 Min Deposit
9.8
  • The Lowest Trading Costs
  • 50% Welcome Bonus
  • Award-winning 24 Hour Support
$200 Min Deposit
9
  • Award-winning Cryptocurrency trading platform
  • $100 minimum deposit,
  • FCA & Cysec regulated
$100 Min Deposit
9.8
  • Trade top Cryptos such as Bitcoin, Litecoin and Ethereum plus more
  • Zero commissions and no bank fees on transactions
  • Around the clock service with support in 14 languages
$100 Min Deposit
8.5
  • Fund Moneta Markets account with a minimum of $250
  • Opt in using the form to claim your 50% deposit bonus
$250 Min Deposit
9
Share with other traders!

Azeez Mustapha

Azeez Mustapha is a trading professional, currency analyst, signals strategist, and funds manager with over ten years of experience within the financial field. As a blogger and finance author, he helps investors understand complex financial concepts, improve their investing skills, and learn how to manage their money.