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>>Yen crashes as Prime Minister Takaichi’s unexpected rate‑hike warning triggers market panic

Yen crashes as Prime Minister Takaichi’s unexpected rate‑hike warning triggers market panic

crypthub

about 4 hours ago

Yen Plunge

The yen fell roughly 1% against the dollar after PM Sanae Takaichi warned of possible early rate hikes. Traders instantly revised expectations of the Bank of Japan’s ultra‑easy stance. USD/JPY broke the 152.50 level while the yen also slipped versus the euro and pound. The move shows how quickly the market reacts to any signal of policy tightening.

BoJ Under Pressure

The BoJ still relies on negative rates, 0% yield‑curve control and massive bond buying. A weak yen raises import costs and fuels household inflation, increasing public pressure. Governor Kazuo Ueda argues inflation must come from wages, not a cheap currency. The prime minister’s comments add political weight to calls for a policy shift.

Global Ripple Effects

A yen rebound could tighten global financing and spark bond sell‑offs. A softer yen benefits exporters but hurts consumers and may pull capital from Japanese bonds. The BoJ’s next decision will be watched for its impact on Japan and world markets.