Yen Tumbles Despite Rate Hike Bets as Interest Rate Differential Takes Hold

The Japanese Yen continues to weaken against the US Dollar, trading near a two-week low of 157.00 despite market expectations for further Bank of Japan (BoJ) rate hikes.

This unexpected move is attributed to the significant interest rate differential between Japan and the US, with US yields remaining higher than those in Japan.

The BoJ has signaled its willingness to normalize policy, but the pace of hikes is expected to be gradual, limiting the yen's upside potential.