09.10.202502:02:14UTC+00Yen Hovers Near 8-Month Low

On Thursday, the Japanese yen hovered around 152.5 per dollar, maintaining its position near the lowest point observed since February. This stagnation is attributed to shifts in the political landscape and lackluster economic indicators, which have reduced the likelihood of interest rate hikes by the Bank of Japan. Sanae Takaichi, a staunch proponent of Abenomics-style economic stimulus, achieved a landmark leadership victory, setting the stage for her potential appointment as Japan's next prime minister. This development has increased expectations for enhanced fiscal spending and the continuation of supportive monetary policies. Concurrently, Japan experienced a 1.4% decline in real wages in August compared to the previous year, marking the eighth consecutive month of decreases as inflation surpassed wage growth. Bank of Japan Governor Kazuo Ueda recently indicated that an interest rate increase might be considered if economic conditions and price levels align with projections, although he also pointed out potential downside risks to economic growth. Investors are now looking ahead to the release of Friday’s producer inflation data for additional insights into monetary policy directions.