Dollar and yen remain steady as markets await BOJ and Fed decisions
The Japanese yen took a breather from its recent rally as the BOJ began its two-day meeting. Several factors have contributed to the yen’s strengthening from the 38-year low against the dollar at the start of the month, including a global stock rout and monetary policy expectations.
The BOJ has already announced plans for quantitative tightening, with a moderate view suggesting the bank will halve its monthly bond purchases over two years. However, questions remain about whether the BOJ will increase rates which could potentially marking Japan’s second hike this year. The central bank has a history of falling short of hawkish market expectations.
Read more to find out about the Japanese yen intervention.
Disclaimer:
The cautious sentiment surrounding the BOJ and Fed meetings could lead to continued tight ranges for the dollar and yen. If the BOJ fails to hike rates, the yen may weaken, while a clear signal from the Fed on rate cuts could bolster the dollar. Traders should be wary of the potential for sudden market shifts due to ongoing political and economic developments, while managing proper risk management along the way.
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