Yen Rises to Highest Level Since February as BoJ Rate Hike Expectations Grow

The Japanese Yen has strengthened to its highest level since February, driven by rising expectations of further Bank of Japan rate hikes before year-end.

This is a departure from previous interventions, according to the Japanese government and many institutions on Wall Street. While even the more hawkish forecasts generally point to quarterly rather than back-to-back rate hikes, expectations are building that the BoJ could raise rates again before the end of the year.

Prime Minister Takaichi's economic adviser, Takuji Aida, recently indicated that he expects a September rate hike followed by quarterly increases. Most economists do not expect consecutive hikes, but a second hike before year-end remains a possibility.