USD/JPY Exchange Rate Hits 0.57% Gain on Strong US Economic Data and Treasury Yields
The US dollar (USD) against the Japanese yen (JPY) exchange rate has been on an upward trend, rising to 158.28 as of Wednesday's session, a 0.57% gain from the previous day.
This increase is largely attributed to the U.S. 10-year Treasury yield hitting 5.058%, its highest level since 2007, and the September composite PMI jumping to 58.4, a five-year high.
The Bank of Japan (BoJ) raised its policy rate by 25 basis points to 1.25% on September 18, but this decision was met with skepticism as two board members voted against it, and Governor Kazuo Ueda offered no commitment to further hikes.
The rate gap between the Federal Reserve's target range of 3.75% to 4.00% and the BoJ's policy rate has widened, giving the dollar a 275-basis-point policy advantage, which is expected to continue driving the exchange rate upwards.