JPY is falling with dignity. Overview for 29.08.2023
The Japanese yen paired with the US dollar has suspended the wave of devaluation. The current USDJPY exchange rate stands at 146.47.
The US dollar's strong position on the global stage, driven by the Federal Reserve's inclination towards further interest rate increases, is exerting pressure on the JPY. In contrast to the Fed's approach, the Bank of Japan still adopts a conservative stance and keeps its interest rate negative. The constant decline of the yen is attributed to the interest rate differential.
Today it was announced that the Japanese government is contemplating a full-fledged economic stimulus package in September. This will include previously announced subsidies for fuel and a range of important goods. This could become a pro-inflationary factor, but with no details available yet, analysing it is challenging.
Should key US statistical data, scheduled for release this week, leave the Federal Reserve with chances for further interest rate hikes, the yen will fall again.
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboMarkets bears no responsibility for trading results based on trading opinions described in these analytical reviews.
The material presented and the information contained herein is intended for our customers, and is for information purposes only and in no way should be considered as the provision of investment advice for the purposes of Investment Firms Law L. 87(I)/2017 of the Republic of Cyprus or any other form of personal advice or recommendation, which relates to certain types of transactions with certain types of financial instruments.