Yen May Continue to Weaken as the Bank of Japan Likely to Raise Interest Rates Again in December
Publication Time:2024-08-21 08:11:06
Volkmar Baur, a strategist at Commerzbank, analyzes that despite the recent rebound of the yen, it may still face depreciation pressure in the long run. He expects the Bank of Japan to take further action and raise interest rates again in December. This prediction is based on the view that the true interest rate hike cycle has not yet started, and the USD/JPY exchange rate will rise next year. Baur stated that the Bank of Japan is likely to raise interest rates in December, although the deputy governor had expressed dovish remarks at previous meetings, and raising interest rates in September was inappropriate, while the October meeting was close to the US election day, so they chose to do it in December. Additionally, changes in market expectations for US-Japan policy interest rates led to a correction in the USD/JPY exchange rate, indicating that the exchange rate was previously overvalued.
Bank of Japan
yen
USD/JPY
interest rate hike
Weakness