Yen has just recovered and lost value

Yen exchange rate today

According to Lao Dong, on March 26, the Japanese Yen (JPY) depreciated against the USD after a slight recovery from the previous session.

The Yen exchange rate against the US Dollar is currently fluctuating around 150.486 USD/JPY; meaning 1 USD can be exchanged for about 150 JPY.

Poor data limits Yen's recovery

The Yen depreciated mainly due to expectations about the monetary policy of the Bank of Japan (BoJ) and interest rate differences between Japan and the US.

According to FXStreet, the services PPI - an important measure of inflation in the Japanese service sector - increased by only 3.0% in February, down slightly from 3.1% in January. This reduces expectations of high inflation, thereby limiting the possibility of the BoJ adjusting interest rates strongly, putting the Yen under downward pressure.

Although BoJ Governor Kazuo Ueda affirmed that the central bank will continue to raise interest rates if the economy and prices develop according to forecasts, the speed of tightening monetary policy is still unclear. Meanwhile, Japan's wages have risen sharply for three consecutive years, creating more room for future rate cuts, but not enough to immediately support the Yen.

On the other hand, the US Federal Reserve (Fed) has signaled a two-time interest rate cut by the end of 2025. However, according to BBC, uncertainty over former President Donald Trump's trade policy including the possibility of imposing tariffs on 15 major trading partners from 2.24 and a 25% tax on countries buying oil and gas from Venezuela is causing major fluctuations in the market.

Although the US Consumer Confidence Index has declined for the fourth consecutive month, leading to a weakening of the USD, the Yen still could not benefit significantly. The BoJ's lack of clear interest rate moves has caused the Yen to continue to depreciate against the USD and other currencies.