The Japanese currency rose to 155.05 yen against the dollar after falling to 160.17 yen against the dollar, fueling speculation that Japanese authorities could intervene to support the currency for the first time since 2022.
On Friday, the Bank of Japan’s monetary policy board decided to maintain the benchmark interest rate, a month after raising the short-term benchmark interest rate to 0.1%, the first increase in 17 years. years.
“It is necessary to pay close attention to developments in financial and foreign exchange markets and the impact on economic activity and prices in Japan,” he said in a statement.
A weak yen tends to boost the stock market, as it inflates exporters’ foreign remittances, but also increases the costs of imports of energy and raw materials, on which Japan is dependent.
The yen has been depreciating sharply against the US dollar, among other currencies, largely due to the interest rate differential between the two countries.
The trend has accelerated in recent weeks because the U.S. central bank is not expected to start cutting rates anytime soon.
