USD/JPY: Japanese Yen Logs Fresh Gains as Bank of Japan Floats More Rate Hikes

Board member Hajime Takata said Thursday Japan’s central bank must keep raising rates while also paying close attention to market moves.

• The USDJPY pair was spotted sliding across the chart early Thursday morning after a speech from a Bank of Japan official triggered a rush to the Japanese currency. The dollar-yen erased about 0.2% from its valuation Thursday, adding to a three-day drop of 2.8%. The exchange rate was eyeing ¥143 with Thursday morning quotes floating near ¥143.20 to ¥143.50, or just about 1.1% from its August 5 low of ¥141.70.
• Bank of Japan policymaker Hajime Takata said on Thursday that central bankers must continue with their monetary policy shift and keep moving interest rates higher. At the same time, the official noted, they should be monitoring the currency space for any outsized speculations, especially after the recent carry trade in the yen, whose painful unwinding this summer shook the fabric of the global financial markets.
• ”The stock and currency market saw big volatility in early August and the fallout continues. As such, we need to scrutinize market developments and their impact for the time being," Takata said in a speech at a business event in the city of Kanazawa. Earlier this week, Bank of Japan Governor Kazuo Ueda reiterated the bank’s intentions for higher rates given that the economy and inflation stayed in line with expectations. In July, the Bank of Japan raised rates to their highest level since 2008.