The yen strengthened rapidly over two days, briefly reaching the ¥155.20-per-dollar range. The BOJ governor's indication of a rate hike and US Treasury Secretary Bessent's remarks calling for a reduction in monetary easing were cited as background factors, accelerating yen buying.
The yen has strengthened rapidly over the past two days from a period of yen weakness against the backdrop of prolonged inflation. As of this morning, the yen stood at around ¥155.20 to the dollar, representing an increase of approximately ¥5 over two days. After remaining at historically weak levels and then temporarily recovering following coordinated intervention by Japan and the United States, the yen has again come under stronger upward pressure.
The rapid strengthening of the yen is believed to have been driven by growing market expectations that remarks by Bank of Japan Governor Kazuo Ueda (植田 和男) and others would accelerate the pace of rate hikes, prompting increased selling of dollars and buying of yen. The possibility that US Treasury Secretary Bessent (ベッセント) also influenced the move by urging Japan to shift away from large-scale monetary easing and fiscal policies cannot be ruled out.
The Bank of Japan's Monetary Policy Meeting is scheduled to be held in approximately two weeks, and views are again emerging that it could have a significant impact on the yen exchange rate going forward.