The yen rose in September. It climbed from the low ¥160s per U.S. dollar on the 2nd to around ¥154 at one point on the 7th, with expectations of an acceleration in the BOJ's pace of interest rate hikes and the unwinding of yen carry trades cited as the background.
The unwinding of the yen's decline accelerated in the foreign exchange market. The yen was in the low ¥160s per U.S. dollar on 2 September but rose to around ¥154 at one point on the 7th.
The background included growing expectations that the BOJ would accelerate the pace of interest rate hikes, while the unwinding of yen carry trades was cited as another factor. In these trades, hedge funds and others borrow yen at low interest rates and invest in higher-yielding assets.
It was reported that U.S. Treasury Secretary Scott Bessent had repeatedly urged the BOJ to raise rates sooner since late August, drawing attention to his meeting with the BOJ governor on 30 August.
At a press conference held by Board member Takata Hajime (高田創), it was also suggested that the pace of rate hikes, which had been expected to be twice a year through 2025, could shift to a new regime in 2026. Views also grew that the contraction of yen carry trades was supporting the yen's rise.