"The USD/JPY pair surged to a nine-day peak of 158.86 following the Bank of Japan's (BoJ) first policy decision of 2026, with the momentum accelerating sharply during Governor Kazuo Ueda's post-meeting press conference. The pair later saw a missive flush toward 157.308. While the central bank technically stood pat, the market's read of the event was one of a hawkish hold, as the divergence between official rhetoric and the surging Japanese Government Bond (JGB) yields forced a frantic repricing of the yen's path."
"While the drivers behind the dollar's sudden crash against the yen remain uncertain, it is unclear whether Japanese authorities have initiated a yen-buying intervention, according to Reuters. The BoJ maintained its short-term interest rate at 0.75%, the highest level in three decades, in an 8-1 vote that saw board member Hajime Takata dissent in favour of an immediate hike to 1.0%."
USD/JPY jumped to 158.86 after the BoJ's first 2026 policy decision, with momentum intensifying during Governor Kazuo Ueda's press conference before falling toward 157.308. Markets treated the BoJ's hold as hawkish because rising JGB yields and stronger rhetoric forced a rapid yen repricing. Uncertainty remains over whether Japanese authorities intervened to buy yen. The BoJ kept the short-term rate at 0.75% in an 8-1 vote, with one dissent for a 1.0% hike. The bank raised growth and core-core inflation forecasts, pushed JGB yields higher, and signalled that wage-price pass-through makes another rate hike likely.
Read at London Business News | Londonlovesbusiness.com
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