Former Bank of Japan Policy Board member Sayuri Shirai (白井さゆり) provides an analysis, explaining why the yen weakened even after the Bank of Japan raised rates and how the year-end budget decision and further U.S. rate hikes could affect the yen.
On 18 September, the Bank of Japan announced a 0.25% rate hike, following the U.S. Federal Reserve’s announcement on the same day. The rate hike failed to contain the yen’s weakness, and the yen weakened after the announcement, reaching approximately ¥157 per dollar.
In an interview with former Bank of Japan Policy Board member Sayuri Shirai (白井さゆり), views were presented on why the yen weakened despite the rate hike and why it would be difficult for the Bank of Japan alone to curb the yen’s weakness. The way fiscal spending expected at year-end is presented was identified as the next focus.