The Japanese yen weakened to around 158.5 per dollar on Wednesday, erasing the prior session’s gains after reports indicated the Bank of Japan is reluctant to deliver a rare back-to-back interest rate hike this month, though it is still considering a possible move in December.
According to those reports, the central bank sees limited justification for consecutive rate increases unless there are clear signs of a marked rise in upside inflation risks. Meanwhile, BOJ Governor Kazuo Ueda said policymakers will continue to closely monitor bond yields, reiterating that long-term interest rates should be guided by market forces. His comments underscored a cautious stance on monetary policy as the BOJ moves further away from its previous strict yield-curve control framework.
The yen also remained under pressure from rising oil prices, as escalating hostilities between Saudi Arabia and Iran-backed Houthi rebels intensified concerns over potential supply disruptions in the Middle East.
