Yen Weakens as BOJ Signals Caution

2025-12-19 07:26 By Jam Kaimo Samonte 1 min. read

The Japanese yen depreciated toward 157 per dollar on Friday, approaching four-week lows after Bank of Japan Governor Kazuo Ueda refrained from signaling a clear path for further rate hikes, emphasizing flexibility to respond to future economic and financial developments.

Ueda also noted ongoing uncertainty around the neutral interest rate, the level at which monetary policy neither stimulates nor restrains economic activity.

The governor added that the BOJ is maintaining close communication with the government amid concerns over Prime Minister Sanae Takaichi’s preference for looser monetary policy.

Earlier, the central bank raised its benchmark rate by 25 basis points to 0.75%, as widely expected, marking its highest level since 1995 as inflation has remained above target for an extended period.

Japan’s headline inflation eased slightly to 2.9% in November from 3% in October but stayed above the BOJ’s 2% target for the 44th consecutive month, while core inflation held steady at 3%.



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