According to FXStreet, on November 18, the Japanese Yen (JPY) increased slightly against the USD after falling to a record low earlier, thanks to the Japanese government's possible intervention in the foreign exchange market to help the Yen.
Bank of Japan Governor Kazuo Ueda said the BoJ will continue to raise interest rates if the economy and prices develop as expected. Ueda also commented that the Japanese economy is recovering gradually, although there are some signs of weakness, and the timing of the rate hike will depend on the economic and price situation.
Separately, Japanese Finance Minister Katsunobu Kato warned on Friday that the Japanese government will monitor the foreign exchange market very closely and will intervene if there are too many fluctuations.
However, the possibility of the Japanese Yen rising sharply remains unclear as there is no official information on whether the Bank of Japan (BoJ) will raise interest rates or not. In addition, positive market sentiment also makes it difficult for the Japanese Yen to rise sharply.
The US dollar remains steady near its yearly high, which is a headwind for the USD/JPY pair. However, the likelihood of a sharp interest rate cut by the US Federal Reserve in the near term is less high, as many believe that President-elect Donald Trump’s policies will be inflationary. This will help the dollar strengthen and make it difficult for the Japanese yen to appreciate.
Investors are eyeing BoJ Governor Ueda's press conference for signs of a possible rate hike in December, which could create volatility and boost demand for the Japanese yen.
