The post Japanese government gives BoJ policy space, avoid excess FX volatility appeared on BitcoinEthereumNews.com. US Treasury Secretary Scott Bessent said on Wednesday that the government’s willingness to allow the Bank of Japan (BoJ) policy space will be key to anchoring inflation expectations and avoiding excess foreign exchange (FX) volatility. Key quotes Government’s willingness to allow BoJ policy space will be key to anchoring inflation expectations, avoiding excess FX volatility.Encouraged by Japan Finance Minister’s deep understanding of how Abenomics has moved away from purely reflationary policy to program that must balance growth, inflationary concerns. Market reaction At the time of writing, the USD/JPY pair is trading 0.34% lower on the day to trade at 151.60. Japanese Yen FAQs The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors. One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The BoJ ultra-loose monetary policy between 2013 and 2024 caused the Yen to depreciate against its main currency peers due to an increasing policy divergence between the Bank of Japan and other main central banks. More recently, the gradually unwinding of this ultra-loose policy has given some support to the Yen. Over the last decade, the BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US… The post Japanese government gives BoJ policy space, avoid excess FX volatility appeared on BitcoinEthereumNews.com. US Treasury Secretary Scott Bessent said on Wednesday that the government’s willingness to allow the Bank of Japan (BoJ) policy space will be key to anchoring inflation expectations and avoiding excess foreign exchange (FX) volatility. Key quotes Government’s willingness to allow BoJ policy space will be key to anchoring inflation expectations, avoiding excess FX volatility.Encouraged by Japan Finance Minister’s deep understanding of how Abenomics has moved away from purely reflationary policy to program that must balance growth, inflationary concerns. Market reaction At the time of writing, the USD/JPY pair is trading 0.34% lower on the day to trade at 151.60. Japanese Yen FAQs The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors. One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The BoJ ultra-loose monetary policy between 2013 and 2024 caused the Yen to depreciate against its main currency peers due to an increasing policy divergence between the Bank of Japan and other main central banks. More recently, the gradually unwinding of this ultra-loose policy has given some support to the Yen. Over the last decade, the BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US…