Australian Dollar softens against Japanese Yen as BoJ hikes rate to highest since 1995
The AUD/JPY cross loses traction to around 113.20 during the Asian trading hours on Tuesday. The Japanese Yen (JPY) edges higher against the Australian Dollar (AUD) following the Bank of Japan (BoJ) interest rate decision. The attention will shift to the Reserve Bank of Australia (RBA) interest rate decision later in the day.
As widely expected, the BoJ decided to raise the short-term interest rate by 25 basis points (bps) to 1.0% from 0.75% after concluding the two-day monetary policy review meeting on Tuesday. The BoJ makes a rate decision by a 7-1 vote. According to the Monetary Policy Statement, the board members will continue to increase the policy rate in response to developments in economic activity, prices and financial conditions.
BoJ Governor Kazuo Ueda, who is hospitalized for medical treatment, missed the meeting and did not vote. Deputy Governor Shinichi Uchida will hold a press conference on Ueda's behalf at 06:30 GMT to explain the policy decision.
On the Aussie front, the RBA is set to keep the Official Cash Rate (OCR) on hold at 4.35% at its June policy meeting on Tuesday, with money markets paring bets on further tightening. This would be a pause following three consecutive 25 bps rate hikes earlier this year. Traders will closely monitor the press conference to see whether RBA Governor Michele Bullock signals some comfort at the current rate or keeps the door open to further moves to counter stubborn price pressures.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Paramount SkyDance (PSKY.US) Nears Settlement Agreement to Advance $110 Billion Warner Acquisition, But Some State Attorneys General Still Withhold Support
According to reports, Paramount is engaged in in-depth negotiations with state attorneys general to facilitate the completion of its $110 billion acquisition of Warner Bros. Discovery; however, not all state attorneys general support this plan.
More Hawkish Than Market Consensus! JPMorgan: South Korea Interest Rates Targeted at 3.75%, Terminal Rate ‘Ceiling’ Undetermined
JPMorgan believes that if semiconductor-driven growth triggers stronger inflation and credit and financial markets remain stable, its already above-market-consensus forecast for South Korea's interest rates will face upside risks.
Ackman "Switches Holdings" to AI Giants: Sells All Alphabet (GOOGL.US) Shares, Increases Meta (META.US) Holdings—Should Investors Follow?
Ackman made it clear that this is not a bearish outlook on Alphabet, but rather a decision to shift funds to other, more attractive opportunities given the current valuation.
