Investing.com– The Japanese yen strengthened on Wednesday after Bank of Japan (BOJ) Governor Kazuo Ueda indicated the central bank may consider a hike if economic and price conditions continue to improve.
Ueda said that the timing of interest rate increases will largely depend on the economic policy of the up-to-date US administration and the progress of this year’s wage negotiations in Japan.
On Wednesday, the yen pair fell by 0.4%, which means the yen strengthened by 0.4% against the US dollar.
A day earlier, BOJ Vice President Ryozo Himino said the central bank may consider raising interest rates at its upcoming policy meeting, citing continued wage growth.
The latest economic indicators show that Japan’s economy is experiencing moderate growth. The economy grew at an annual rate of 1.2% in the third quarter, helped by increased consumer spending and a stable labor market.
In March last year, the BOJ ended its negative interest rate policy and by July raised the short-term interest rate to 0.25%.
It is currently considering further interest rate increases as inflation remains consistently above the central bank’s 2% target.
The next BOJ policy meeting is scheduled for January 23–24.
