Weaker Japanese inflation data dampens expectations for near-term Bank of Japan policy adjustments, pressuring the yen.
The yen fell for a second consecutive week, with USD/JPY rising to 159.04 as softer inflation data reduced bets on imminent Bank of Japan tightening. The pair closed higher amid shifting monetary policy expectations.
Prior to this week, the yen had already faced downward pressure, with USD/JPY trading near multi-decade highs. Analysts had anticipated potential intervention or policy shifts, but recent data weakened those prospects.
Markets now await further signals from the Bank of Japan, with traders assessing the likelihood of future rate adjustments or currency stabilization measures.