JPY has weakened. Overview for 02.04.2024

The Japanese yen, paired with the US dollar, is weakening again. The current USDJPY exchange rate stands at 151.74.

The instrument is moving closer to the levels at which the market expects interventions from the Japanese authorities.

Japan's minister of finance, Shunichi Suzuki, makes statements and comments daily. This is not reassuring for many, but the monetary policymaker should be optimistic given his position while the yen is declining to a 34-year low.

Suzuki noted that the authorities are ready to take appropriate measures against excessive exchange rate volatility. Bears are not afraid: so far, it has not gone beyond verbal interventions.

While Japan is not ruling out any options to combat the yen's excessive weakness, it is not threatening to intervene. Instead, the authorities are adopting a stance of active observance.

The key reason for the yen's weakness is the differential between the Bank of Japan and the US Federal Reserve's interest rates, which interventions cannot rectify, and the market is aware of this.