The Japanese Yen gained ground against both the US Dollar and Australian Dollar amid growing expectations of an interest rate hike by the Bank of Japan. On Thursday, the USD/JPY pair traded near 153.45, close to a six-month low of 152.89 reached the previous day, according to FX Street.
Kazuyuki Masu, a member of the BoJ policy board, noted that the current policy rate remains below the estimated neutral rate and has been so for an extended period. This comment has fueled speculation that the central bank may soon adjust its monetary policy to address inflation concerns.
The AUD/JPY pair also reflected these expectations, trading near 110.75. Market participants are closely watching the BoJ’s next moves, as Japan’s inflation target remains at 2%, and any policy shift could significantly impact currency markets and broader financial conditions.