Yen Slides Amid BoJ Rate Hike Uncertainty

(RTTNews) - The Japanese yen retreated from early highs against its major currencies in the European session on Thursday, amid rising speculation that the Bank of Japan (BoJ) may take a long time before raising interest rates again this year.

Recently, the BoJ Governor Kazuo Ueda stated that the central bank's near-term focus was on downside risks to Japan's economy, with the impact of U.S. tariffs projected to intensify in the second half of this year, implying that the BoJ was not in a hurry to initiate rate hikes.

The uncertainty surrounding U.S. trade policies is also expected to weigh on the JPY.

Traders await the Japan's May National Consumer Price Index (CPI) data and Bank of Japan (BoJ) Monetary Policy Meeting Minutes, due to be published later on Friday.

The safe-haven JPY was trading higher against its major rivals in the Asian trading today, amid escalating trend in the ongoing conflict between Israel and Iran as they continued to attack each other for the seventh consecutive day, with speculation of the U.S. joining Israel in striking Iranian nuclear sites.

In the European trading today, the yen fell to 166.75 against the euro, 195.00 against the pound and 177.75 against the Swiss franc, from an early 3-day high of 166.04, a 6-day high of 194.03 and a 1-week high of 176.76, respectively. If the yen extends its downtrend, it is likely to find support around 168.00 against the euro, 198.00 against the pound and 179.00 against the franc.

Against the U.S. dollar, the yen edged down to 145.41 from an early high of 144.74. The yen is likely to find support around the 147.00 region.

Looking ahead, the BoE is expected to retain its benchmark rate at 4.25 percent amid rising geopolitical tensions and inflation remaining persistently above the target. The announcement is due at 7.00 AM ET.

U.S. stock markets are closed in observance of Juneteenth holiday.