USD/JPY trades higher to near 156.30 ahead of FOMC minutes
- USD/JPY rises to near 156.30 ahead of the release of FOMC minutes.
- The BoJ’ SoP signals more interest rate hikes in 2026.
- Fed officials see only one interest rate cut next year.
The USD/JPY pair trades 0.17% higher to near 156.30 during the Asian trading session on Tuesday. The pair gains as the Japanese Yen (JPY) is slightly under pressure, even as the Bank of Japan (BoJ) Summary of Opinions (SOP) for the December meeting, released on Monday, showed that policymakers advocated remaining on the monetary tightening path in 2026.
Japanese Yen Price Today
The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the weakest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.02% | 0.01% | 0.16% | -0.06% | -0.18% | -0.04% | -0.07% | |
| EUR | 0.02% | 0.03% | 0.18% | -0.04% | -0.16% | -0.02% | -0.05% | |
| GBP | -0.01% | -0.03% | 0.17% | -0.05% | -0.19% | -0.05% | -0.09% | |
| JPY | -0.16% | -0.18% | -0.17% | -0.21% | -0.33% | -0.20% | -0.18% | |
| CAD | 0.06% | 0.04% | 0.05% | 0.21% | -0.11% | 0.02% | -0.02% | |
| AUD | 0.18% | 0.16% | 0.19% | 0.33% | 0.11% | 0.14% | 0.10% | |
| NZD | 0.04% | 0.02% | 0.05% | 0.20% | -0.02% | -0.14% | -0.04% | |
| CHF | 0.07% | 0.05% | 0.09% | 0.18% | 0.02% | -0.10% | 0.04% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).
“There is still considerable distance to levels deemed neutral," a BoJ member said, adding the central bank should raise rates "with intervals of a few months in mind for the time being", Reuters reported. A few BoJ members also stated that more interest rate hikes are necessary to strengthen the Yen.
In the policy meeting, the BoJ raised interest rates by 25 basis points (bps) to 0.75%, as expected.
Last week, BoJ Governor Kazuo Ueda also stressed on the need of additional interest rate hikes, citing that labor market conditions have tightened as wage and price-setting behaviour by firms have changed, and price pressures seems sustainably returned to the 2% target.
Meanwhile, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades flat around 98.00 at the press time, ahead of the release of Federal Open Market Committee (FOMC) minutes of the December meeting in late New York session.
In the policy meeting, the Fed reduced interest rates by 25 basis points (bps) to 3.50%-3.75% and signaled there will be only one in 2026. In 2025, the Fed delivered three interest rate cuts of quarter-to-a-percent.
Bank of Japan FAQs
The Bank of Japan (BoJ) is the Japanese central bank, which sets monetary policy in the country. Its mandate is to issue banknotes and carry out currency and monetary control to ensure price stability, which means an inflation target of around 2%.
The Bank of Japan embarked in an ultra-loose monetary policy in 2013 in order to stimulate the economy and fuel inflation amid a low-inflationary environment. The bank’s policy is based on Quantitative and Qualitative Easing (QQE), or printing notes to buy assets such as government or corporate bonds to provide liquidity. In 2016, the bank doubled down on its strategy and further loosened policy by first introducing negative interest rates and then directly controlling the yield of its 10-year government bonds. In March 2024, the BoJ lifted interest rates, effectively retreating from the ultra-loose monetary policy stance.
The Bank’s massive stimulus caused the Yen to depreciate against its main currency peers. This process exacerbated in 2022 and 2023 due to an increasing policy divergence between the Bank of Japan and other main central banks, which opted to increase interest rates sharply to fight decades-high levels of inflation. The BoJ’s policy led to a widening differential with other currencies, dragging down the value of the Yen. This trend partly reversed in 2024, when the BoJ decided to abandon its ultra-loose policy stance.
A weaker Yen and the spike in global energy prices led to an increase in Japanese inflation, which exceeded the BoJ’s 2% target. The prospect of rising salaries in the country – a key element fuelling inflation – also contributed to the move.
추천 기사
