Yen exchange rate today
According to Lao Dong, on June 17, the Japanese Yen (JPY) maintained a stable trend after the Bank of Japan (BoJ) decided to keep the short-term interest rate unchanged at 0.5%, as expected by the market. Although the JPY has somewhat recovered after a two-day downward trend, the rally has been held back by cautious sentiment and trade and geopolitical uncertainties.
The BoJ said it will continue to implement the criticalized monetary tightening (QT) policy. The plan to reduce purchases of Japanese government bonds (JGB) will be implemented gradually from now until the end of fiscal year 2026, with the goal of reducing purchases to about 2,000 billion yen per quarter by early 2027. However, the central bank did not give a clear signal about the next interest rate hike roadmap, causing the market to lack momentum to break out.
Investors cautiously await Governor Ueda's speech
Investor sentiment continues to be affected by the unfavorable results of the G7 summit, when Japan and the US have not reached a new trade agreement. Prime Minister Shigeru Ishiba has proposed that the US lift a 25% tariff on Japanese cars and a 24% on other imports, but the two sides have yet to find a common voice. At the same time, Japanese Finance Minister Katsunobu Kato warned that rising oil prices and a weak Yen are adverse combinations for the Japanese economy, which depends heavily on energy imports.
In that context, investors are waiting for the press conference of BoJ Governor Kazuo Ueda to seek clearer signals on policy orientation in the coming time. Some opinions say that the BoJ may delay the interest rate hike until early 2026, especially as geopolitical instability in the Middle East is increasing, pushing oil prices up and further complicating the inflation outlook.
The market is also closely monitoring developments from the US Federal Reserve (Fed) this week to assess the possibility of US interest rate adjustments, a factor that can strongly affect the next trend of the USD/JPY exchange rate pair. In the short term, the Yen is forecast to continue to fluctuate within a narrow range with a neutral trend, as both buyers and sellers do not have enough basis to make a breakthrough.
