Yen exchange rate today
According to Lao Dong, on July 9, the Japanese Yen (JPY) continued to decline as the USD (USD) maintained its strong momentum, causing the USD/JPY pair to remain around 147.00.
The main reason for the weakening of the Yen is concerns about the economic impact when US President Donald Trump announced the imposition of a 25% tax on Japanese goods from August 1.
Mr. Trump also warned that if Japan retaliates, the US will respond similarly. Meanwhile, Japanese Prime Minister Shigeru Ishiba affirmed that he will continue negotiations to seek a mutually beneficial bilateral trade deal, but trade tensions still overshadow Japan's economic prospects.
Yen continues to plummet
According to FXStreet, the Japanese economy declined in the first quarter due to weak consumption, while data showed that real wages in Japan in May fell the fastest in 20 months.
This makes the market believe that the Bank of Japan (BoJ) will continue to be cautious, making it unlikely to raise interest rates this year, further losing the Yen's appeal.
In addition, domestic political uncertainty has also put pressure on the Yen as recent polls show that the ruling coalition between the Liberal Democratic Party (LDP) and Komeito is at risk of not winning a majority of seats in the Senate election on July 20. This could complicate trade negotiations and increase political risks in Japan.
On the other hand, the USD is still strongly supported as the market expects US inflation to increase due to higher import taxes, forcing the US Federal Reserve (Fed) to keep high interest rates in the coming time. The USD hit a two-week high yesterday's session as the market believes the Fed will not rush to cut interest rates, especially as the US labor market remains strong.
