Yen Rises Amid BoJ Rate Hike Bets, Trump's Tariff Threats

(RTTNews) - The Japanese yen strengthened against other major currencies in the Asian session on Thursday, amid rising bets that the Bank of Japan (BoJ) would hike interest rates further. The safe-haven JPY also firmed on geopolitical worries.

Asian stock markets traded lower, as the U.S. Fed's minutes showed policymakers are more inclined to keep interest rates steady amid stubborn inflation. The continued concerns about the potential impact of higher tariffs to be imposed by the U.S. on partner nations also hurt market sentiment.

The minutes of the latest U.S. Fed policy meeting on January 28-29 revealed that officials want to see further progress on inflation before they consider resuming lowering interest rates. It also reiterated officials believe a "careful approach" in considering additional adjustments to the stance of monetary policy is appropriate given the high degree of uncertainty.

The meeting participants said the upside risks to the inflation outlook partly reflected the possible effects of potential changes in trade and immigration policy.

In the Asian trading today, the yen rose to more than a 2-month high of 150.05 against the U.S. dollar, from yesterday's closing value of 151.22. The next possible upside target for the yen is seen around the 148.00 region.

Against the euro and the pound, the yen advanced to 9-day highs of 156.51 and 188.99 from Wednesday's closing quotes of 157.60 and 190.29, respectively. If the yen extends its uptrend, it is likely to find resistance around 154.00 against the euro and 186.00 against the pound.

Against the Swiss franc and the Canadian dollar, the yen climbed to 10-day highs of 166.26 and 105.51 from yesterday's closing quotes of 167.19 and 106.21, respectively. The yen is likely to find resistance around 165.00 against the franc and 104.00 against the loonie.

Against the Australia and the New Zealand dollars, the yen jumped to 9-day highs of 95.33 and 85.73 from Wednesday's closing quotes of 95.89 and 86.21, respectively. On the upside, 93.00 against the aussie and 83.00 against the kiwi are seen as the next resistance levels for the yen.

Looking ahead, Eurostat releases euro area construction output data for December at 5:00 am ET in the European session.

At 6.00 am ET, the Confederation of British Industry publishes Industrial Trends survey results for February. The order book balance is forecast to rise to -30 in February from -34 in January.

In the New York session, Canada new housing price index, PPI data and raw material price index, all for January, U.S. weekly jobless claims data, U.S. Philly Fed business conditions for February, U.S. Consumer Board's leading index for January and U.S. EIA crude oil data are slated for release.