FX.co ★ Yen Weakens on Ueda Remarks

The Japanese yen fell beyond 153 per dollar on Thursday, reaching a nine-month low following comments from Bank of Japan Governor Kazuo Ueda. He noted that while the economy is on a path of moderate recovery, international trade policies could pose a threat to growth and potentially affect corporate earnings. These remarks came in the wake of the central bank's decision to maintain its policy rate at 0.5%, a move that aligned with expectations. The decision was supported by a 7-2 vote, with board members Naoki Tamura and Hajime Takata once more advocating for a rate increase to 0.75%, consistent with their position from September. The Bank of Japan reaffirmed its stance to initiate policy normalization once its economic forecasts are achieved. Nevertheless, newly appointed Prime Minister Sanae Takaichi's backing of a supportive monetary policy adds complexity to the prospects of further tightening measures. Additionally, the yen was pressured by a stronger dollar after the US Federal Reserve implemented an anticipated quarter-point rate cut. However, Federal Reserve Chair Jerome Powell clarified that a subsequent rate cut in December remains uncertain and is not a predetermined decision.