The Japanese Yen weakens despite higher bond yields and Bank of Japan rate hike expectations, lifting USD/JPY from intraday lows.
The USD/JPY pair rebounded to 159.25 on Monday after earlier selling pressure, as the Japanese Yen (JPY) failed to strengthen despite a softer US Dollar (USD). The recovery followed an intraday low near 159.00, reflecting persistent weakness in the Yen even amid rising bond yields and growing bets on a Bank of Japan (BoJ) policy shift.
Market expectations for a BoJ rate hike have increased in recent weeks, supported by stronger-than-expected inflation data and hawkish signals from policymakers. However, the Yen’s inability to gain traction highlights ongoing concerns about Japan’s economic outlook and the pace of monetary tightening.
Traders remain cautious ahead of upcoming BoJ communications, with focus on whether the central bank will signal further tightening or maintain a gradual approach.