The yen depreciated again to 152.
On October 7th, the yen fell to 152 yen per dollar in the New York foreign exchange market, reaching this level for the first time in approximately eight months since mid-February. Concerns about the proactive fiscal and loose monetary policies advocated by Liberal Democratic Party President Sanae Takaichi led investors to continue selling the yen, creating a phenomenon known as “high-market trading.”
The yen also hit a new all-time low against the euro, reaching 177.10 yen per euro, a level of yen depreciation and euro appreciation since the euro’s creation in 1999.
The yen also hit a new all-time low against the euro, reaching 177.10 yen per euro, a level of yen depreciation and euro appreciation since the euro’s creation in 1999.
Esuro Honda, one of Takaichi’s economic advisors and a former member of the Cabinet Secretariat, said in an interview with Bloomberg on the 6th, “If the yen exceeds 150 yen per dollar, it might be a bit excessive.” Influenced by these remarks, the yen briefly rebounded to the 150 yen range on the 7th, but yen selling once again took hold in New York trading.
The yen’s continued depreciation is driven by the widespread market belief that Japan’s loose monetary environment will persist. Honda also expressed her understanding in the interview, stating that it would be “difficult” for the Bank of Japan (BoJ) to raise interest rates at its monetary policy meeting on October 29th and 30th.
As early as last year during the Liberal Democratic Party presidential election, Takaichi stated, “Raising interest rates now would be foolish,” attempting to deter the BoJ from raising rates too quickly. In her speech on October 4th, she reiterated that “the government bears responsibility (for monetary policy)” and stated, “The Japanese economy is on an extremely dangerous edge,” signaling caution against excessive monetary tightening.
In the US market, some institutions believe that, while the extent of Takaichi’s involvement in the BoJ’s operations remains unclear, her fundamental views on monetary policy appear to have remained unchanged.
This concern has fueled persistent selling pressure on the yen in the market, becoming the primary factor behind its continued weakness.
Currently USD/NZD price has risen to 1.7400。
source: NZD