This report looks at current Japanese Yen exchange rates and the factors that will impact them today and into next week.

Latest update from the Bank of Japan change markets

Interestingly the Japanese Yen has been losing ground this week against the Pound. It has fallen by nearly 3% and we have seen a further drop of 1.6% already this morning. Investors have been taking money out of the JPY as speculation had built that additional stimulus would be announced by the Bank of Japan this morning.

The Bank of Japan actually surprised the markets and introduced a negative interest rate in a similar effort to the European Central Bank to increase growth along with inflation. The Yen has strengthened by nearly 10% compared to December as a result of global factors so it seems increasingly likely the the central bank will continue to intervene to weaken the currency due to their large economical dependency on exporting goods and services around the world.

The interest rate cut to -0.1% means that the central bank will now charge commercial banks .01% on some of the deposits. The decision to change policy was split by the nine members by 5-4 so I would not be surprised if we see further changes in their next meetings later this year.

Japan has been previously pursuing a QE program to try and tackle inflation, which again this morning was confirmed to remain stubbornly low at 0.5%, well away from the 2% target. The markets have reacted with significant gains for anyone buying Japanese Yen. If however you are looking to sell Yen it may be prudent to do this sooner rather than later to take advantage of the recent gains.

Thank you for reading my Japanese Yen (JPY) currency forecast, if you have any questions about JPY exchange rates I would be more than happy to discuss them – you can contact me with any queries at hse@currencies.co.uk.

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Exchange rates on this page are interbank rates and indicate where the market is trading to show the performance of a currency pair. They are not indicative of the rates which we offer. The information on this web site is provided free of charge for information purposes only. It does not constitute advice to any person on any matter. Foreign Currency Direct plc. ("FCD") makes every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to the same.