Yen at Risk of Fresh Slide as BOJ Meeting Looms

The yen continues to slide ahead of the Bank of Japan's (BOJ) policy meeting on Friday, with investors watching for Governor Kazuo Ueda's signal on further rate hikes.

Markets expect the BOJ to keep its benchmark rate unchanged, but attention is centered on whether Ueda offers any clues about the timing of the next rate increase.

The yen has been under pressure due to rising oil prices, concerns about Japan's fiscal health, and the interest-rate gap between the US and Japan. If Governor Ueda fails to deliver a sufficiently hawkish signal, the yen could break above 165 per dollar, triggering foreign-exchange intervention.

About half of economists surveyed by Bloomberg expect the BOJ to wait until December before raising rates, while the overnight index swap market prices in a 29% chance of a rate increase by September and 78% by October.