Bank of Japan Decision Spurs Volatility in USD/JPY

The USD/JPY pair remains volatile ahead of the Bank of Japan's policy decision. In recent days, the yen has staged a rapid rebound in value, sparking speculation that Japanese authorities may have intervened in the foreign exchange market.

Market expectations had shifted towards a potential rate hike by the central bank, but now investors are paying closer attention to the central bank's stance on exchange rate movements and inflationary pressures. The Bank of Japan is expected to maintain its policy rate at 1%, with no immediate rate adjustments planned.

The meeting will also release the latest quarterly economic outlook report, which is expected to revise up economic growth projections due to stable domestic performance and stronger investment demand linked to artificial intelligence.