USD/JPY Sees Narrow Range Amid Fed Pause and Rising Geopolitics

The USD/JPY exchange rate held steady around 163.50 on Thursday after the US Federal Reserve's decision to keep interest rates unchanged.

Although three FOMC members voted in favour of a rate hike, Fed Chairman Kevin Warsh emphasized that the pause should not be seen as a rejection of future policy tightening, with decisions remaining data-dependent.

The Bank of Japan is expected to leave its own interest rates unchanged on Friday but may signal further hikes to support the yen.

Geopolitical tensions have increased following reports of renewed US airstrikes on Iran, which could impact the exchange rate.