Yen Vulnerability Grows as BoJ Hints at No Hawkish Signals

The Japanese Yen has been under pressure due to expectations that the Bank of Japan (BoJ) will not provide any hawkish signals on future rate hikes, despite leaving rates unchanged.

This week's drop in energy prices has eased some pressure on Japanese policymakers and slowed the upward momentum for USD/JPY, which has held just below the 164.00-level since late last week.

The BoJ is expected to keep rates on hold after hiking at the last meeting in June, but market participants will be watching closely for any hints of a faster pace of rate hikes, as reported by Bloomberg last week.

Without clear guidance on tightening, the Japanese Yen remains vulnerable, especially if the Federal Reserve (Fed) surprises with a hawkish policy move this week.