, mainly because interest rates in Japan remain much lower than those in the United States and elsewhere, diminishing the currency’s relative allure.The yen’s decline has both benefited and harmed the economy, businesses and consumers. Japanese policymakersagainst the possibility they may have to intervene to support the currency, as they did in 2022.
“However, if the yen moves in a narrow range like now due to risk of intervention, it’s hard to justify the intervention.”The yen has been the worst performer in 2024 among major currencies against the US dollar, falling more than 6 per cent. in a range of 5.25 per cent to 5.5 per cent. That is a major gap favouring investments in the US and therefore the dollar.That will largely depend on the trajectory of the interest rate gap.
Investors and economists are split over whether the BOJ is finished with raising interest rates in 2024 or will make another move.
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