FX.co ★ Japanese Yen Retreats on Profit-Taking

The Japanese yen depreciated to approximately 155.7 per dollar on Tuesday, pulling back after three consecutive days of appreciation as traders moved to secure profits. This recent upsurge was driven by increasing speculation about a potential interest rate hike by the Bank of Japan, hinting at a possible shift in its monetary policy approach. In a recent announcement, Finance Minister Satsuki Katayama emphasized the absence of any discrepancies between the government and the BOJ in their economic assessments, underscoring a unified stance between fiscal and monetary strategies. She also remarked on her expectation for the BOJ to maintain close collaboration with the government, executing monetary policies aimed at reaching a 2% inflation target, bolstered by sustainable wage increases. Katayama’s statements came after comments from BOJ Governor Kazuo Ueda, who expressed confidence in Japan’s economic prospects and suggested that the central bank would deliberately weigh the advantages and disadvantages of raising interest rates during its December policy deliberations.