FX.co ★ Yen Strengthens as BOJ Holds Rates Steady

The Japanese yen appreciated beyond 149 against the dollar on Thursday, recovering from the previous day's declines after the Bank of Japan (BOJ) opted to keep interest rates steady, a decision anticipated by analysts. This marks the fourth straight meeting where the BOJ has maintained its rate stance unchanged, following a 25 basis-point increase to 0.5% in January. The central bank exercised caution, noting that core inflation is anticipated to dip temporarily due to slower growth before rising again. While the outlook for inflation remains balanced, the central bank indicated that economic risks are skewed towards the downside. Policymakers also highlighted escalating uncertainties surrounding global trade dynamics and how these could affect Japan's economic performance. Additionally, the yen had depreciated to near a four-month low on Wednesday. This decline followed the US Federal Reserve's decision to hold rates steady while providing minimal guidance on potential rate cuts, thereby strengthening the dollar.