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The Japanese Yen tumbled nearly 1% today, pushing the USD/JPY pair back above the 156.00 level (trading near 156.20). This sharp sell-off reversed recent gains and occurred despite a broader “risk-off” mood in global markets following new U.S. tariff threats.
What Trigger the Sell-Off?
A report from the Mainichi Shimbun revealed that Prime Minister Sanae Takaichi expressed strong concerns about further interest rate hikes during a meeting with BoJ Governor Kazuo Ueda. This “dovish” stance from the administration has severely dampened expectations for a March or April rate hike.
In addition to that, recent National CPI data showed inflation cooling faster than expected and falling below the Bank of Japan’s 2% target. This gives the BoJ less justification to tighten monetary policy.
While other central banks are staying cautious, the perception that Japan’s government is actively blocking normalization makes the Yen an unattractive “carry” currency once again.
What’s Next?
All eyes are on Governor Ueda’s upcoming speeches to see if he will maintain his independent hawkish tilt or bow to political pressure.
Meanwhile, Trump’s newly proposed 15% blanket tariffs trigger a global trade war, the Yen may eventually see “safe-haven” buying, but for now, the interest rate gap remains the dominant driver.
Technical Levels: Traders are watching the 157.00 mark. A break above this could open the door for a retest of the 160.00 psychological barrier.
Disclaimer
Comments, news, research, analysis, price, and all information contained in the article only serve as general information for readers and do not suggest any advice. Ultima Markets has taken reasonable measures to provide up-to-date information, but cannot guarantee accuracy, and may modify without notice. Ultima Markets will not be responsible for any loss incurred due to the application of the information provided.
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