Yen reacts sharply to messages Bank of Japan

02/10/2023

1 minute read

2023.02.10 15:03

Yen reacts sharply to messages Bank of Japan

The Japanese yen has had a busy day, rising as much as 1.1% today before losing most of those gains. presently trades at 131.04, a decrease of 0.37% during the European session.

Following a report that Kazua Ueda would be chosen as the Bank of Japan’s next governor, the Japanese yen saw sharp gains. Ueda will take over for Haruhiko Kuroda at the beginning of April.

He previously served on the BoJ’s policy board. Ueda is expected to take a more hawkish stance than Kuroda, who was the architect of an ultra-loose monetary policy that has largely remained in place despite the fact that other major banks have been hiking rates to combat inflation. Although the gains in the yen were only temporary, they indicate that Ueda is expected to take a more hawkish stance.

The yen has been volatile as a result of the BoJ Governor selection debate. The news that Deputy Governor Masayoshi Amamiya had been approached for the position earlier this week temporarily lowered the yen because Amamiya is regarded as a dove. Amamiya turned down the offer, and if the most recent report is correct, the hawkish Ueda at the helm should make things very interesting.

US unemployment claims rose above the consensus of 190,000 for the first time in six weeks, going from 183,000 to 196,000. Nonetheless, this was the fourth week with claims below 200,000.

The four-week moving average, which helps to smooth out a lot of the volatility from week to week, actually fell to 189,250. Despite reports of Amazon (NASDAQ:) mass layoffs, this suggests that the labor market remains tight. NASDAQ: Facebook, and other significant businesses.