Yen is at a 34-year low as the Bank of Japan keeps interest rates unchanged

The yen plummeted to its lowest level against the dollar in three decades on Friday following the Bank of Japan’s decision to maintain interest rates, heightening expectations among traders for potential intervention by Tokyo authorities to stabilize the currency.

After the Bank of Japan announced its decision to keep short-term interest rates unchanged within the range of zero to 0.1 percent, the yen dropped by approximately 0.2 percent, reaching 156.1 against the dollar. It also marked its lowest level against the euro in 16 years, hitting 167.38 per euro, and nearly a decade low against the Australian dollar.

While the market anticipated no alteration in monetary policy, attention shifted to glean insights from the statements of Bank of Japan Governor Kazuo Ueda during a press conference scheduled for 3:30 pm Tokyo time (0630 GMT).

Japanese Finance Minister Shunichi Suzuki reiterated on Friday his close monitoring of currency movements and readiness to take necessary steps in response.

Meanwhile, the dollar faced pressure from weaker-than-expected US growth data, despite Treasury bond yields rising due to signs of persistent inflation exceeding expectations.

The euro climbed 0.3 percent on Thursday to its highest level in two weeks, reaching $1.0728, following reports of the US economy’s slowest growth in nearly two years during the first quarter.

In Asian trading on Friday, the Australian dollar briefly surpassed the 200-day moving average, hitting $0.6539, before settling around 0.6522.

The British pound surged by 0.4 percent on Thursday, reaching $1.2503, while the New Zealand dollar continued its upward trend, hitting $0.5960 in Asian morning trading after achieving gains over the previous four sessions.