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Yen stays near 163.90 after Japan CPI, while traders eye BoJ
Japan’s core CPI rose to 1.6% year over year in June, and traders are also watching for possible yen intervention before the Bank of Japan meeting.
The Japanese yen held around 163.90 per USD in early Asia trade on Friday, staying close to a multi-decade low as markets weighed fresh inflation data and upcoming Bank of Japan (BoJ) policy.
According to data released by Japan’s Statistics Bureau, Japan’s national consumer price index rose to 1.7% year over year in June, up from 1.5% in May. Core CPI increased to 1.6% year over year, compared with 1.4% previously, marking the first rise in core inflation since March, while “core-core” inflation eased to 1.7% year over year.
FXStreet noted the inflation print lined up with market consensus and said it has limited near-term impact on the yen because traders are focused on the BoJ meeting, where rates are widely expected to be left unchanged. It also pointed to Finance Minister Satsuki Katayama’s warning that authorities are ready to take “appropriate and bold action” if needed to address currency moves.
The report added that traders are on alert for possible Japanese intervention, and said escalating Middle East tensions could support the US dollar versus the yen in the near term. It also highlighted that the yen is influenced by BoJ policy, Japanese versus US bond yield differentials, and risk sentiment.