USD/JPY Retreats from Peaks. Japanese Yen Exhibits Some Stability Against US Dollar. The current USD/JPY exchange rate stands at 140.61.
During Friday's session, the Bank of Japan convened its regular meeting, opting to maintain the interest rate at -0.1% per annum. As a result, the central bank continues to diverge from global trends by adhering to its stimulus plan.
In the post-meeting comments, the BoJ emphasized that the yield curve control program (YCC) remains unaltered.
Significantly, the BoJ maintains its belief that inflation in the country will decelerate in the upcoming months, a perspective that contradicts the majority of economists' opinions. This introduces a certain level of risk: if the regulator anticipates a decline in pressure on the consumer price index, it is unlikely to take any action regarding interest rates.
Such a stance works against the JPY in the medium term, as it sustains a wide interest rate differential between the Bank of Japan and the US Federal Reserve.