Yen Weakens as Political Pressure Mounts on BOJ Over Rate Hike Path

The Japanese Yen faced significant selling pressure against the US Dollar following reports of political friction regarding the Bank of Japan's (BOJ) monetary policy. Prime Minister Sanae Takaichi reportedly expressed reluctance to Governor Kazuo Ueda concerning the central bank's plans for further interest rate hikes. This political interference has cast doubt on the BOJ's normalization path, pushing the USD/JPY pair toward the 156.00 level. Market momentum strengthened after the pair broke above its 100-day moving average of 154.98, signaling a bullish trend for the Dollar. While the Yen weakens, the proximity to 156.00 raises the risk of direct intervention by the Japanese Finance Ministry to stabilize the currency. Investors are now closely monitoring the balance between political influence and the central bank's commitment to its tightening cycle.