FX.co ★ Yen Stays Under Pressure as BOJ Signals Caution

The Japanese yen weakened past 159 per dollar on Wednesday, hovering near one-month lows after Bank of Japan Governor Kazuo Ueda highlighted rising inflation risks but stopped short of signaling a possible interest rate hike at the central bank’s next policy meeting. Ueda underscored the need to carefully assess how higher oil prices are affecting Japan’s underlying inflation trend, while offering little detail on how those pressures might influence next month’s policy decision. At the same time, BOJ Deputy Governor Ryozo Himino reiterated that the central bank remains committed to further rate increases, stressing that their timing and pace will depend on how the Middle East conflict shapes Japan’s economic conditions and inflation outlook. Investors also continued to watch developments in the region, where tentative signs of progress toward a US-Iran agreement were overshadowed by renewed hostilities that kept the broader outlook uncertain.