Yen Weakness: ING Sees 160 Target as Divergent Policies Persist

The Japanese Yen is under pressure from divergent monetary policies between the US Federal Reserve and the Bank of Japan, according to an analysis by ING.

ING strategists point out that a persistent interest rate differential between the two countries has put downward pressure on the yen. The Fed has signaled a slower pace of rate cuts than expected, while the BoJ remains cautious in normalizing its ultra-loose monetary policy.

This has kept Japanese yields significantly lower than US yields, making the yen vulnerable to further weakness.