The Federal Reserve raised interest rates by a quarter-point to a range of 3.75-4.00%, prompting notable market reactions across multiple currencies, FX Street reported. Following the hike, USD/JPY traded just below 156.50, reflecting the impact on the Japanese yen. Meanwhile, the Bank of Japan is set to meet on Friday, with markets fully pricing in a 1.25% quarter-point rate increase.
In other currency moves, the New Zealand dollar has declined for six consecutive sessions, slipping below 0.5850 from near 0.5900 since September 8, according to FX Street. Australia’s cash rate stands at 4.35%, surpassing the Fed’s new range, and major Australian banks expect the Reserve Bank of Australia (RBA) to raise rates again before the end of the year.
Adding to the discourse, former US President Donald Trump tweeted his view that US rates should be 1% or less and suggested that cutting trade with deficit countries could generate $1.5 trillion annually. For Japanese investors, these global rate shifts underscore the ongoing volatility in FX markets, influencing yen valuations and cross-border investment strategies.