Yen Rises Amid Speculations On BOJ Rate Hike

(RTTNews) - The Japanese yen strengthened against other major currencies in the European session on Wednesday, as traders' speculate that the Bank of Japan will adjust its ultra-dovish monetary policy in the policy board meeting to be held later this month.

Markets speculate that the Bank of Japan may tighten its highly accommodative monetary policy at the two-day policy board meeting starting on July 27th. Meanwhile, the U.S. and Europe have been hiking rates.

The safe-haven yen has started rising in the Asian trading today.

In the European trading today, the yen rose to nearly a 1-month high of 153.64 against the euro from yesterday's closing value of 154.47. The yen may test resistance near the 149.00 region.

Against the pound and the Swiss franc, the yen advanced to a 3-week high of 180.45 and nearly a 3-week high of 158.71 from yesterday's closing quotes of 181.46 and 159.44, respectively. If the yen extends its uptrend, it may find resistance around 173.00 against the pound and 154.00 against the franc.

Against the U.S. and the Canadian dollars, the yen climbed to near 1-month highs of 139.31 and 105.46 from yesterday's closing quotes of 140.36 and 106.08, respectively. The next resistance level for the yen is seen around 136.00 against the greenback and 100.00 against the loonie.

Looking ahead, U.S. MBA weekly mortgage approvals data, U.S. inflation data for June, U.S. EIA weekly crude oil report, U.S. WASDE report, and U.S. Fed Beige book report are slated for release in the New York session.

At 8:45 am ET, Philip R. Lane, member of the Executive Board of the European Central Bank and Federal Reserve Bank of Minneapolis President Neel Kashkari will participate in a panel at the NBER conference "Summer Institute 2023 - Macro, Money and Financial Frictions" in Cambridge Massachusetts, USA.

At 9:00 am ET, the Bank of Canada key will announce its interest rate decision and monetary policy report. The economists expect a rate hike of 25 bps to 5.0 percent from 4.75 percent.

After an hour, the Bank of Canada Governor Tiff Macklem and Senior Deputy Governor Carolyn Rogers will hold a press conference to discuss the contents of the report, in Ottawa, Canada.

At 12:00 pm ET, Federal Reserve Bank of Atlanta President Raphael Bostic is scheduled to speak on "Financial and Payments Inclusion" before the Federal Reserve Bank of Atlanta 2023 Payments Inclusion Forum: "Breaking Barriers", in Atlanta, U.S.

At 3:00 pm ET, Federal Reserve Bank of Cleveland President Loretta Mester will speak on "FedNow" before a session on Instant Payment Systems before the National Bureau of Economic Research Summer Institute: Macro, Money and Financial Frictions," in Cambridge, Massachusetts, U.S.