The USD/JPY pair experienced a correction, but its impact is likely to be temporary.
The Japanese yen, in tandem with the US dollar, has found stability. The current USD/JPY exchange rate is at 149.56.
Today marks the commencement of a two-day meeting by the Bank of Japan, scheduled to conclude on Tuesday with a decision on interest rates. There is a strong likelihood that the rate will remain at -0.10% annually. It's crucial to pay attention to the Central Bank's statement's details, which are expected to extensively address the yen's ongoing devaluation and its impact on the economy and financial markets.
The BoJ may attribute its inaction to insufficient wage growth in Japan. However, it may simultaneously raise its core inflation forecasts for FY 2023 and FY 2024, while the outlook for 2025 is anticipated to remain unchanged and below 2%.
The yen's trajectory is significantly affected by the Bank of Japan's continued adherence to its current monetary policy structure. The interest rate differential between the BoJ and the US Federal Reserve is a key driver of JPY's fluctuations.