Yen exchange rate today
According to Lao Dong, on May 1, the Japanese Yen continued to depreciate against many other currencies after the Bank of Japan (BoJ) kept interest rates unchanged at 0.5% and gave a cautious look at economic prospects. The decision comes as the BoJ lowered its growth forecast and raised concerns about the impact of higher tariffs from the US.
In addition to keeping the policy, BoJ also adjusted the core inflation forecast for the 2026 fiscal year from 2% to 1.7%. However, this agency still believes that inflation will reach a goal of 2% in the final stage of the forecast cycle (lasting up to 2027). BoJ confirmed that he will continue to raise interest rates if the economy and the price are in accordance with expectations.
Investors are hesitant
However, investors still believe that the BoJ may raise interest rates in 2025, as inflation in Japan shows signs of spreading. This has made the market await a statement from BoJ Governor Kazuo Ueda at a press conference after the meeting, for further clues on upcoming monetary policy.
In the opposite direction, according to FXstreet, a series of new data from the US shows that the country's economy is slowly. The number of new jobs in the US private sector in April is only 62,000 - much lower than expected. GDP growth in the first quarter of 2025 also recorded a negative level of 0.3%, while PCE inflation continued to cool down. These factors raise concerns about the risk of recession and consolidate the expectation that the Federal Reserve (Fed) will start cutting interest rates from June.
President Donald Trump also contributed to increased volatility when he announced that he was able to sign trade agreements with India, South Korea, Japan and especially China. This makes market sentiment more cautious.
As the Fed could cut interest rates aggressively this year, the US dollar is weakening and trading near its lowest level in many years. However, the decline of the Japanese Yen has not stopped, as investors still need more clear signals from the BoJ before betting on the uptrend again.
