Bank of Japan Raises Rates, Yen Strengthens
Bank of Japan Raises Rates, Yen Strengthens
The Bank of Japan (BOJ) has raised short-term interest rates to 0.5%, the highest level in 17 years. While this move was anticipated, the currency market responded with a significant strengthening of the yen, with USD/JPY falling by approximately 0.6%.
At a press conference, BOJ Governor Ueda stated that there is no predetermined course for future rate adjustments. Meanwhile, media reports cite analysts’ opinions suggesting that the rate could be raised again before the end of 2025.
Technical analysis of the USD/JPY chart shows the formation of a descending channel (highlighted in red) at the start of 2025. The news of the rate hike enabled bears to launch another attack on the psychological level of 155 yen per dollar—a level that had previously served as support earlier this month. As of the morning of 24 January, bulls are managing to defend this level, but how long can they hold out if bearish pressure persists?
Key points to note:
→ The USD/JPY trend resembles a rounding-top pattern.
→ The yen's strength is also supported by the dollar’s weakness, influenced by some uncertainty surrounding the introduction of international trade tariffs promised by US President Trump.
Today, at 17:45 GMT+3, the Purchasing Managers' Index (PMI) figures will be released, potentially triggering heightened volatility in financial markets.
Trade on TradingView with FXOpen. Consider opening an account and access over 700 markets with tight spreads from 0.0 pips and low commissions from $1.50 per lot.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
The Bank of Japan (BOJ) has raised short-term interest rates to 0.5%, the highest level in 17 years. While this move was anticipated, the currency market responded with a significant strengthening of the yen, with USD/JPY falling by approximately 0.6%.
At a press conference, BOJ Governor Ueda stated that there is no predetermined course for future rate adjustments. Meanwhile, media reports cite analysts’ opinions suggesting that the rate could be raised again before the end of 2025.
Technical analysis of the USD/JPY chart shows the formation of a descending channel (highlighted in red) at the start of 2025. The news of the rate hike enabled bears to launch another attack on the psychological level of 155 yen per dollar—a level that had previously served as support earlier this month. As of the morning of 24 January, bulls are managing to defend this level, but how long can they hold out if bearish pressure persists?
Key points to note:
→ The USD/JPY trend resembles a rounding-top pattern.
→ The yen's strength is also supported by the dollar’s weakness, influenced by some uncertainty surrounding the introduction of international trade tariffs promised by US President Trump.
Today, at 17:45 GMT+3, the Purchasing Managers' Index (PMI) figures will be released, potentially triggering heightened volatility in financial markets.
Trade on TradingView with FXOpen. Consider opening an account and access over 700 markets with tight spreads from 0.0 pips and low commissions from $1.50 per lot.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
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