Yen Slumps 1.25% as Bank of Japan Hikes Rates Amid December Expectations
The Japanese yen slid by about 1.25% after the Bank of Japan's decision to raise its overnight rate target to 1.25%. This move was met with a narrow mix in US dollar performance against G10 currencies, while the euro hovered just below $1.15 due to heavy options expiries.
The yen's decline comes as markets still price in an 80% chance of another Bank of Japan hike in December, despite the trimmed odds. The dollar briefly jumped to JPY158 after settling below JPY156, with the 200-day moving average sitting near JPY158.40, a key technical resistance level.
In other currency news, China's PBOC fixed the dollar lower for an eighth straight session, reaching a new three-year low. The offshore dollar-yuan rate dropped to CNH6.6935, its lowest point in four years.