The yen is in a freefall once again. Overview for 27.09.2023

The Japanese yen, paired with the US dollar, remains on a devaluation path. The current exchange rate for USDJPY is 149.03.

A meeting between politicians and representatives of the Bank of Japan ended with somewhat vague remarks. The head of the regulator, Kazuo Ueda, emphasised the importance of monitoring any positive changes in the economic landscape. Members of the council, representing private business, stressed the necessity of implementing a flexible fiscal policy. The private sector believes that it is high time for the Bank of Japan to assess the potential impact of future interest rate hikes on the economy.

However, all these discussions remained at the verbal level, and no significant decisions made. As previously mentioned, market expectations for intervention by the Bank of Japan seem overvalued. If the regulator intended to intervene in the trading dynamics, it would likely have taken action by now.

The 150.00 yen per dollar threshold will be psychologically important for both Japan's economy and investors. Breaking through this level could trigger a new wave of JPY selling.