The Japanese yen, paired with the US dollar, continues to balance in a sideways range. The current USDJPY exchange rate stands at 147.76.
A week ago, the instrument reached a peak at 148.80.
Core inflation in Tokyo in January dropped to 1.6% y/y, compared to the previous figure of 2.1% and a forecast of 1.9%. This is negative news for the JPY and the national regulator.
This week, price action has remained unstable since the Bank of Japan’s meeting. All market expectations regarding potential monetary policy tightening have shifted to April. The Bank of Japan may stabilise the interest rate at zero after maintaining a negative rate for many years. However, to accomplish this, the government must promptly address the earthquake's consequences in the country on 1 January.