The Yen is getting weaker by the minute. Overview for 31.07.2018
On Tuesday, USDJPY rose quickly; the Yen is retreating due to the BoJ’s policy.
The Japanese Yen is falling significantly against the USD today. The current quote for the instrument is 111.45.
During the latest meeting, the Bank of Japan decided not to change its monetary policy, although changes were exactly what the currency market was expecting. All key parameters remained the same, including the benchmark rate, which was -0.10%.
Of course, no one thought the BoJ would switch from its conservative strategy and immediately introduce dramatic changes in the QE program and rates. Investors didn’t expect anything like this, but some slight changes in the above-mentioned parameters would be really appreciated. However, it didn’t happen.
A bit earlier, market players discussed a possibility of decreasing the QE volume in the future. The policy that is pursued by the Bank of Japan right now is mostly intended to support the inflation. Still, the program is not 100% efficient like the regulator thought it would be, that’s why it is facing a lot of criticism. However, right now there are no other tools that may help the Japanese economy to beat the deflation, so the Bank of Japan is trying to stick to its plan, which is supported by Cabinet of Ministers.
After the July meeting, the regulator announced that it was going to keep the benchmark rate intact for a long time. It means that the BoJ’s monetary policy won’t be tightened in the nearest future.
The Japanese Yen didn’t like the BoJ’s decisions and started plummeting.
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