USD/JPY remained firm around 153.90 in Asia on Monday, not far from its eight-month peak of 154.49 hit on November 4. The pair’s strength reflects yen weakness as markets grapple with an unclear rate-hike path from the Bank of Japan.
BOJ board member Junko Nakagawa said on Monday that policymakers will tread carefully given ongoing uncertainty over global trade policies. She warned that Japanese corporate profits could be squeezed by tariffs but should rebound as overseas economies recover and domestic consumption picks up on stronger real wages. Nakagawa also noted that medium- and long-term inflation expectations are gradually converging on the BOJ’s 2% target.
Minutes from October’s monetary policy meeting highlighted persistent uncertainty about when the BOJ might lift its policy rate. The report suggested any decision to tighten will depend on sustained improvements in economic and price trends, stable global financial conditions, and continued active wage-setting by firms.
Meanwhile, the US dollar may find extra support after the Senate on Sunday voted 60–40 to advance a funding bill aimed at ending the government shutdown by extending enhanced Affordable Care Act subsidies. According to Reuters, the measure still needs approval from the House and the president’s signature, steps that could take several days.
