USD/JPY plunged 2.2% to 144.37 last week. Bank of Japan Governor Kazuo Ueda stood by the decision to keep hiking rates, DBS Senior FX Strategist Philip Wee notes.

Ueda stands by the decision to keep hiking rates

“USD/JPY plunged 2.2% to 144.37 last week, opening the door to retesting the 141.70 low in early August.” 

“At the special parliamentary hearing on August 23, Bank of Japan Governor Kazuo Ueda stood by the decision to keep hiking rates if the central bank’s median economic forecasts were met or exceeded.”

“Ueda attributed the brief market volatility from July 11 to August 5 to rising fears of a US recession from the Fed’s rate cut bias on rising joblessness, not the BOJ’s rate hike.”