USD/JPY Recovery Stalls Below 156.00 Ahead of BoJ Decision
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Japan Raises Benchmark Rate to 1.25%, Highest Since 1995
Bank of Japan lifted its benchmark rate from 1.0% to 1.25% to counter inflation risks. The move caps a tightening cycle that began with wage growth of 4.7% YoY and upgraded Q2 GDP, signalling the central bank is accelerating its reaction function. EUR/JPY weakened 15.5 pips before the announcement. Traders now watch for forward guidance on further moves.
https://www.aljazeera.com/news/2026/9/18/japans-interest-rate-hiked-to-31-year-high-at-1-25-as-inflation-rises?traffic_source=rssJapan Rate Hike Cycle Accelerates to Fastest Pace Since 1990
BOJ expected to tighten monetary policy at its fastest rate in over three decades as inflation pressures persist. JPY strengthens on hawkish pivot; USD/JPY and EUR/JPY face downside pressure. This contrasts with global central banks pausing, reshaping carry-trade dynamics and regional rate differentials.
https://www.bloomberg.com/news/videos/2026-09-18/the-asia-trade-9-18-2026-videoReplies
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