At the time of writing, the USDJPY pair was trading at 108.65. The pair is in decline on Friday afternoon and could retreat to 108.45. If this mark is breached, the road to 108.35 will be open for the bears.
Japanese yen is on the rise
The Bank of Japan’s March meeting ended today with some unexpected decisions. The regulator held interest rates steady at -0.10%, in line with expectations, but lowered the ceiling for annual asset purchases to JPY 6 trln. The central bank’s buyback program has been running since 2016 and has totaled JPY 6 trln per year, but the bank allowed it to double in the spring of 2020, at the height of the pandemic. Now the scope is being cut, which could be a positive signal for the economy. That said, the regulator reserves the right to make large-scale purchases if market conditions require it.