AUD/JPY Stays Strong Near 94.50 as Traders Doubt BOJ Rate Hike
The Australian dollar against the Japanese yen (AUD/JPY) is staying strong near 94.50. Earlier, it dropped a little but quickly bounced back. Traders are not fully sure if the Bank of Japan (BOJ) will raise interest rates soon.
Several things are affecting the currency pair:
* The Japanese yen is under some pressure. Japan’s inflation and wage growth are rising. Some BOJ officials say they are close to reaching their 2% inflation target. This makes people think BOJ may raise rates, but there is still doubt.
* The Australian dollar was weaker earlier because Australia’s capital spending dropped by 0.2% in the last quarter compared to the previous one.
* Traders are waiting for more economic data from Japan, such as industrial production, retail sales, and Tokyo’s inflation numbers. These reports could give clues about what the BOJ will do next.
* In Australia, the central bank (RBA) is not expected to raise rates right now. One of its officials said the strong job market is keeping inflation a bit high.
Impact: The AUD/JPY pair might stay around current levels. It could rise if BOJ signals a rate hike, or fall if Australia’s economy weakens further.