The yen depreciated to 156 yen per dollar today, April 26, following the Bank of Japan’s (BOJ) decision to maintain interest rates unchanged. The central bank also announced its intention to continue bond purchases, according to decisions made in the previous month’s meeting.
Kyodo News Agency reported that the yen dipped to its lowest level in 34 years, dropping below the 155 yen per dollar threshold earlier in the day.
The BOJ opted to retain the policy interest rate at 0-0.1%, aligning with economists’ forecasts following the rate hike in March.
During the meeting, the BOJ provided an outlook suggesting that Japan’s inflation would remain at the central bank’s target of 2% until fiscal year 2026. For the ongoing fiscal year, commencing in April 2024, the Core Consumer Price Index (Core CPI), excluding fresh food prices, is anticipated to rise by 2.8%, surpassing the earlier forecast of 2.4%.
Additionally, the BOJ reiterated its commitment to bond purchases, consistent with decisions made in the March meeting.
The yen’s depreciation against the dollar reflects market reactions to the BOJ’s policy decisions, highlighting the importance of central bank actions in influencing currency movements. As the BOJ maintains its stance on interest rates and bond purchases, investors continue to assess the implications for the yen’s value amid evolving economic conditions.