The yen-to-dollar exchange rate (yen/dollar) approached the 158 yen level on the 20th, marking the highest level in five months.
On this day, the yen/dollar exchange rate briefly reached 157.9 yen during trading at the Tokyo foreign exchange market.
At around 1:35 PM, the yen/dollar exchange rate was moving around 157.12 yen. An increase in the yen-to-dollar exchange rate indicates a decline in the value of the yen.
The Nihon Keizai Shimbun (Nikkei) analyzed, "The previous day's remarks by Kazuo Ueda, Governor of the Bank of Japan (BOJ), were perceived as cautiously 'dovish,' leading to a retreat in expectations for an early BOJ rate hike and the view that it will take time for the US-Japan interest rate gap to narrow, which affected the yen's market trend."
The BOJ decided to keep interest rates unchanged at its monetary policy meeting held on the 18th and 19th. Governor Ueda stated, "One more step is necessary to judge a rate hike." The market interpreted this as meaning that barriers to a rate increase still remain.
In response to the rapid yen depreciation, the Japanese government also stepped in to curb the trend. Finance Minister Katsunobu Kato told reporters after the Cabinet meeting that day, "There are unilateral and rapid movements beneath the surface," and added, "We are concerned, including about speculative trends." He also emphasized, "A stable trend is important," and stated, "We intend to respond appropriately to excessive movements."
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