Yen exchange rate today
According to Lao Dong, on August 8, the Japanese Yen (JPY) depreciated against the USD, under pressure from positive market sentiment and a new report from the Bank of Japan (BoJ).
The Minutes of the "Summary of Opinions" meeting in July showed that policymakers are still concerned about tariff instability from the US, but maintained the view that they will continue to raise interest rates in the coming time.
Optimism in the Japanese stock market further reduces demand for the Yen as a safe-haven asset. The Topix index surpassed the 3,000-point mark for the first time, while Nikkei 225 increased to its highest level since July 25.
This has caused investors to shift to more risky assets, thereby putting pressure on the JPY. At the same time, the USD recovered slightly, helping the USD/JPY pair increase by about 60-70 pip from the lowest level of the session, around the support zone of 146.70.
Yen depreciates but will not decrease sharply
According to FXStreet, the Yen's decline was not too strong. Investors are still cautious about selling fake JPYs as the market increasingly believes that the BoJ will raise interest rates by the end of this year. In contrast, the US Federal Reserve (Fed) is expected to resume its interest rate cutting cycle in September, thereby limiting the possibility of the USD increasing sharply. This difference in monetary policy is seen as a supporting factor for the Yen in the medium term.
Japan's economic data released earlier showed household spending in June fell 5.2% from the previous month - the sharpest decline since January 2021. The reason is that rising prices put pressure on consumption and could slow down the BoJ's interest rate increase process.
In the US, the first unemployment benefit application report last week rose to a one-month high, showing the labor market is cooling down. This further reinforces expectations of a Fed rate cut.
In addition, concerns about the Fed's independence have also arisen as President Donald Trump nominated Chairman of the Economic Advisory Council Stephen Miran as Fed Governor and reduced the list of candidates to replace Chairman Jerome Powell.
