BOJ Hawkishness Key to Yen Rebound, Says BlackRock's Rick Rieder

BlackRock's Chief Investment Officer for Global Fixed Income Rick Rieder says that supporting the yen will require more than just government intervention and needs hawkish signals from the Bank of Japan. The Japanese currency has recently rebounded towards its cheapest level in four decades, trading at around 160 per dollar.

Rieder believes that foreign-exchange intervention is not a sustainable solution for a yen rebound, as it requires significant firepower to be effective. He argues that monetary policy needs to be adjusted to make the central bank's intentions clear: raising interest rates and being hawkish when necessary.

Japan's benchmark rate stands at 1%, which is lower than the Federal Reserve's target range of 3.5% to 3.75%. The next potential hike by the Bank of Japan is expected in September or October, with some traders anticipating a Fed rate increase by year-end.