Japan's Economy Minister Yoshitaka Shindo said on Thursday that Japanese economy is expected to continue moderate recovery. Shindo further stated that he will closely monitor the risks related to foreign exchange fluctuations that would push up domestic prices.
Key quotes
“Economy is expected to continue a moderate recovery.”
“Need to pay close attention to risks related to forex fluctuations that would push up domestic prices.”
“Need to pay close attention to global economic downturn risks such as the outlook on the Chinese economy, crude oil prices due to unstable situations in the Middle East.”
“Government will continue comprehensive efforts to ensure solid wage hikes will spread to mid- and small-sized firms.”
Market reaction
At the time of writing, USD/JPY is trading 0.52% lower on the day at 154.08.
Japanese Yen FAQs
The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors.
One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The current BoJ ultra-loose monetary policy, based on massive stimulus to the economy, has caused the Yen to depreciate against its main currency peers. This process has exacerbated more recently due to an increasing policy divergence between the Bank of Japan and other main central banks, which have opted to increase interest rates sharply to fight decades-high levels of inflation.
The BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supports a widening of the differential between the 10-year US and Japanese bonds, which favors the US Dollar against the Japanese Yen.
The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD holds ground above 1.1700 amid softer US Dollar
EUR/USD holds ground above 1.1700 in the European session on Thursday. The pair stays supported as the US Dollar faces headwinds from lingering US tariffs and economic concerns. Attention turns to central bank talks and mid-tier US data for fresh trading impetus.
Crypto market sees $500 million in liquidation as Bitcoin hit record highs amid dovish Fed minutes
Bitcoin reached a new all-time high of $111,999 on Wednesday amid dovish Fed minutes, fueling wider market optimism. CoinGlass data shows that over $500 million in leveraged positions were liquidated across crypto markets in the past 24 hours.
GBP/USD stays well bid above 1.3600 as US Dollar continues to sag
GBP/USD trades with moderate gains above 1.3600 in European trading on Thursday. The US Dollar softens against the Pound Sterling amid growing uncertainty around the impact of Trump's tariffs on the economy and the Fed's interest rate outlook. Fedspeak and US data are awaited.
Gold price builds on steady intraday ascent amid softer USD, trade worries
Gold price is building on the overnight bounce from a one-and-a-half week low and gaining positive traction for the second straight day on Thursday. Investors remain on edge amid uncertainties surrounding US President Donald Trump's erratic trade policies and their impact on the global economy.
New US tariffs target Asia, but some countries stand to gain
President Trump’s new tariffs are higher than expected for most Asian economies. Moreover, most countries will face additional tariff rates on transshipments. The new announcements are silent on Singapore, India and the Philippines, which might stand to benefit from tariff concessions if negotiations progress favourably.
Best Brokers for EUR/USD Trading
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.