USD/JPY fell in Tokyo trading on the 17th as yen buying prevailed ahead of the Bank of Japan meeting, reaching 155.72 in the afternoon. EUR/JPY also fell in tandem, with cross-yen pairs broadly lower.
USD/JPY fell in Tokyo trading on the 17th. It declined to 155.72 in the afternoon as the market favored yen buying ahead of the release of the Bank of Japan's monetary policy meeting decision and Governor Ueda (植田)'s press conference. USD/JPY traded around the low 156 range during the morning before falling below 156 shortly after noon. EUR/JPY also fell in tandem to 178.58, and cross-yen pairs were broadly lower.
Market attention is focused on the Bank of Japan's stance after implementing a 0.25% rate hike, with signals on the pace and timing of further hikes the main focus. Whether Governor Ueda (植田) adopts a more hawkish stance at his press conference is expected to influence the direction of the yen.
In trading on the previous day, the 16th, USD/JPY fell from a peak of 155.49 amid expectations of an accelerated pace of Bank of Japan rate hikes, while expectations of a rate hike weighed on the pair and limited gains. In the United States, the FOMC raised the policy rate to 4.00% and revised up its longer-term outlook, but trading continued to reflect expectations of a narrowing US-Japan interest rate differential. The Bank of Japan meeting is being held from the 17th to the 18th. While a 0.25% rate hike is widely expected, views are divided over the path of further hikes.
The day's trading ranges were 155.72 to 156.32 for USD/JPY, 178.58 to 179.22 for EUR/JPY, and 1.1456 to 1.1473 for EUR/USD. Conditions remain conducive to Bank of Japan policy changes exerting upward pressure on the yen, with yen buying particularly pronounced in cross-yen pairs.