Japanese yen pares gains after BOJ meeting – heochaua

<p><a href="https://api.addthis.com/oexchange/0.8/forward/facebook/offer?url=https%3A%2F%2Fwww.marketpulse.com%2Fnews-events%2Fcentral-banks%2Fjapanese-yen-pares-gains-after-boj-meeting%2Fkfisher&amp;pubid=ra-525512e4690e068c&amp;title=Marketpulse%20%7C%20Home&amp;ct=1" target="_blank"><img src="https://cache.addthiscdn.com/icons/v3/thumbs/32×32/facebook.png" border="0" alt="Facebook" /></a><a href="https://api.addthis.com/oexchange/0.8/forward/twitter/offer?url=https%3A%2F%2Fwww.marketpulse.com%2Fnews-events%2Fcentral-banks%2Fjapanese-yen-pares-gains-after-boj-meeting%2Fkfisher&amp;pubid=ra-525512e4690e068c&amp;title=Marketpulse%20%7C%20Home&amp;ct=1" target="_blank"><img src="https://cache.addthiscdn.com/icons/v3/thumbs/32×32/twitter.png" border="0" alt="Twitter" /></a><a href="https://api.addthis.com/oexchange/0.8/forward/email/offer?url=https%3A%2F%2Fwww.marketpulse.com%2Fnews-events%2Fcentral-banks%2Fjapanese-yen-pares-gains-after-boj-meeting%2Fkfisher&amp;pubid=ra-525512e4690e068c&amp;title=Marketpulse%20%7C%20Home&amp;ct=1" target="_blank"><img src="https://cache.addthiscdn.com/icons/v3/thumbs/32×32/email.png" border="0" alt="Email" /></a></p><p>The Japanese yen is slightly lower in the European session on Tuesday. USD/JPY fell 0.54% after today’s BoJ policy meeting but has pared most of those gains and is trading at 147.82, down 0.18%.</p>
<p><strong>Bank of Japan stays pat</strong></p>
<p>As expected, the BoJ maintained its policy settings at today’s meeting. In a unanimous decision, the BoJ board kept interest rates at -0.1% and maintained its yield curve control policy of an upper limit of 1% as a reference for 10-year Japanese government bonds. The BoJ lowered its core inflation forecast for fiscal 2024 to 2.4%, compared to 2.8% in the October forecast.</p>
<p>The BoJ played it safe at today’s meeting, keeping policy intact but lowering the inflation forecast. The BoJ doesn’t appear in a rush to tighten policy, but investors have been bitten before and are aware that the BoJ has a knack for surprising the markets. Governor Ueda has been hinting at a shift in policy, and the Bank’s negative rates seem out of place in a world of higher inflation.</p>
<p>Ueda has insisted that high inflation is due to cost-push factors and that he won’t tighten policy until wage growth increases, as this would provide evidence that inflation is driven by domestic demand and is sustainable at 2%. National wage talks commence in March and if it appears that employee wages will rise, the BoJ could make a major policy announcement in April or in June.</p>
<p>Governor Ueda stated in a follow-up press conference that the probability of reaching the 2% sustainable inflation target is rising and there is evidence of a positive wage-inflation cycle. The BoJ may not have made any changes at today’s meeting, but Ueda’s comments are slight hints that a policy change is only a question of time.</p>
<p>.</p>
<p><strong>USD/JPY Technical</strong></p>
<ul>
<li>USD/JPY has pushed through several support levels and is testing support at 146.98</li>
<li>There is resistance at 148.44 and 148.76</li>
</ul>
<p> </p>
<p><img loading="lazy" class="alignnone wp-image-809542" src="https://www.marketpulse.com/wp-content/uploads/2024/01/USDJPY_2024-01-23_13-25-48-300×146.png" alt="" width="400" height="194" srcset="https://www.marketpulse.com/wp-content/uploads/2024/01/USDJPY_2024-01-23_13-25-48-300×146.png 300w, https://www.marketpulse.com/wp-content/uploads/2024/01/USDJPY_2024-01-23_13-25-48-1024×497.png 1024w, https://www.marketpulse.com/wp-content/uploads/2024/01/USDJPY_2024-01-23_13-25-48-768×373.png 768w, https://www.marketpulse.com/wp-content/uploads/2024/01/USDJPY_2024-01-23_13-25-48-1536×746.png 1536w, https://www.marketpulse.com/wp-content/uploads/2024/01/USDJPY_2024-01-23_13-25-48.png 1835w" sizes="(max-width: 400px) 100vw, 400px" /></p>