The Federal Reserve and the European Central Bank keep interest rates unchanged, and the yen will not strengthen significantly.

According to economists at Nordea, the yen will not strengthen significantly as long as the Federal Reserve and the European Central Bank keep interest rates unchanged. Higher interest rates from the Bank of Japan may help the Japanese yen (JPY) to some extent, but for the yen to strengthen, the Fed will need to cut interest rates significantly.

Fed and ECB keep rates unchanged

Recently, both the Federal Reserve and the European Central Bank have decided to keep interest rates unchanged, which plays a key role in the trend of the yen. If the two major central banks continue to maintain policy unchanged, the yen is unlikely to strengthen significantly.

The impact of the Bank of Japan's interest rate hike on the Japanese yen

While the Bank of Japan's interest rate hikes may help the yen, the impact is only to a certain extent. For the yen to truly strengthen, the Federal Reserve will need to significantly cut interest rates, which will have a substantial impact on the yen exchange rate.

The impact of the Fed’s interest rate cuts on the Japanese yen

If the Federal Reserve implements a sharp interest rate cut policy, it will have a significant impact on the Japanese yen. This could lead to a strengthening of the yen, especially against the US dollar. Therefore, the Fed's policy actions are crucial to the direction of the yen.

in conclusion

Overall, as long as the Federal Reserve and the European Central Bank keep interest rates unchanged, the yen will not strengthen significantly. Raising interest rates from the Bank of Japan may help, but for the yen to truly strengthen, a significant rate cut from the Federal Reserve will be needed. Therefore, investors should pay close attention to the policy initiatives of major central banks and their impact on the yen exchange rate.