London Daily

Focus on the big picture.
Friday, Mar 06, 2026

Yen slumps to 9-year low vs euro after BOJ maintains ultra-low rates

Yen slumps to 9-year low vs euro after BOJ maintains ultra-low rates

The Japanese yen fell to a nine-year low against the euro on Friday after the Bank of Japan left its ultra-easy monetary policy unchanged even as it scrapped a pledge to keep interest rates low, according to Reuters.
The euro briefly rose to its highest level against the yen since December 2014 at 149.50. It was last up 1 percent at 148.98 yen with expectations the European Central Bank will hike rates again next week also supporting the single currency.

The outcome of new BOJ Gov. Kazuo Ueda’s first policy meeting was closely watched. As expected, the BOJ said it would maintain ultra-low interest rates, and unanimously decided to make no changes to its yield curve control policy.

However, the central bank removed a pledge to keep interest rates at “current or lower levels” and said it would “conduct a broad-perspective review of monetary policy.”

That review is expected to last around one to one-and-a-half years and would lay the groundwork for Ueda to gradually phase out his predecessor’s massive stimulus program.

The yen fell sharply also against the US dollar, down 1.3 percent to 135.78, its lowest since March 10.

“The hopes of a policy change has been somewhat dampened by the review,” said Moh Siong Sim, a currency strategist at Bank of Singapore, adding that the likely length of the review might have cooled hopes of an imminent move in the policy setting.

“For now, the outcome is read as a dovish outcome.”

On Friday, however, government data showed core consumer prices in Japan’s capital, Tokyo, rose 3.5 percent in April from a year earlier, beating market forecasts in a sign of broadening inflationary pressure in the world’s third-largest economy.

“This puts pressure on the BOJ, they might do something in the near future,” said Tina Teng, market analyst at CMC Markets.

Elsewhere, the euro fell 0.4 percent to $1.10986, but remained near its recent one-year high, after German first quarter growth came in weaker than expected. Bloc-wide gross domestic product figures are due at 0900 GMT.

The common currency was eyeing a monthly gain of more than 1.3 percent buoyed by expectations that the ECB still has further to go in raising interest rates, analysts said.

The International Monetary Fund called on the ECB on Friday to keep raising interest rates until the middle of 2024 and on EU finance ministers to tighten fiscal policy, in concerted action to bring down high inflation.

“Investors favor currencies that can offer both an ongoing domestic tightening cycle and still some room for a hawkish surprise at the coming meetings,” said ING analysts.

“In that sense, the euro is one of the very few currencies that can offer this combination at the moment.”

In the wider currency market, the US dollar rose broadly on Friday, drawing support from data pointing to still-sticky inflation, which reinforced expectations for a 25-basis-point rate hike at next week’s FOMC meeting.

The US dollar index gained 0.5 percent to 101.93, rebounding from a near two-week low struck on Wednesday.

However, the index remained on track for a monthly loss of close to 0.8 percent, after having fallen about 2.3 percent in March.

Data released on Thursday showed that while US economic growth slowed more than expected in the first quarter, consumer spending, which was accompanied by a rise in inflation, accelerated.

“The Fed is widely expected to hike again next week but with inflation remaining sticky, we expect the Fed to stay on hold for the remainder of the year, dashing hopes of a policy pivot in (the second half),” said analysts at Societe Generale.
Newsletter

Related Articles

0:00
0:00
Close
Iceland Supermarket Drops Trademark Challenge Against Icelandic Government in Long-Running Naming Dispute
UK Defence Secretary Visits Cyprus Following Scrutiny of Britain’s Response to Drone Attacks
Questions Grow Over Britain’s Military Readiness as Response to Iran Conflict Draws Scrutiny
UK Offers Failed Asylum Seeker Families Up to Forty Thousand Pounds to Leave Voluntarily
Saharan Dust Could Bring ‘Blood Rain’ to Parts of the UK as Weather Systems Shift
UK Deploys Additional Typhoon Fighter Jets to Qatar and Helicopters to Cyprus Amid Rising Middle East Tensions
Experts Urge Britain to Accelerate Renewable Energy Push as Global Conflicts Drive Up Costs
British Public Shows Strong Reluctance to Join Wider War in Iran
First UK Evacuation Flight Departs Middle East After Lengthy Delay
United Kingdom Imposes New Visa Requirements on Travelers from St. Lucia and Nicaragua
Iran Conflict Strains U.S.–U.K. Alliance as Trump and Starmer Clash Over Military Strategy
UK Interest Rates Could Rise Above Four Percent Again if Energy Shock Continues, Think Tank Warns
Starmer Defends Britain’s Iran Strategy as Badenoch Urges Stronger Military Support
Labour MP Says She Saw No Sign Husband Broke Law After Arrest in China Espionage Investigation
UK Jobless Rate Overtakes Italy’s for First Time in Years as Labour Market Weakens
United Kingdom Suspends Student Visas for Four Countries in Unprecedented Immigration Move
Campaigners Warn UK Student Visa Ban Could Push Migrants Toward Dangerous Channel Crossings
First U.K. Charter Flight for Stranded Nationals Set to Depart Oman Amid Middle East Crisis
France and United Kingdom Deploy Warships to Eastern Mediterranean as Middle East Conflict Escalates
U.K. Arrests Three Men Including Lawmaker’s Partner in Suspected China Espionage Investigation
Trump Says UK–US ‘Special Relationship’ Is Diminished Amid Middle East Dispute
UK Economic Forecasts Face Fresh Strain from Middle East Conflict and Rising Energy Costs
UK Reaffirms Close US Ties After Trump’s Public Criticism
Reeves Stresses Stability and Fiscal Discipline in UK Budget Update as Growth Outlook Shifts
UK Deploys Royal Navy Destroyer HMS Dragon to Cyprus After Drone Strike on RAF Base
Green Party Surges Past Labour in New UK Poll as Traditional Party Support Crumbles
Majority of Britons Oppose U.S. Use of UK Military Bases in Iran Conflict
UK Intensifies Evacuation Efforts from Oman, Working with Airlines to Boost Flight Capacity
Trump Condemns UK and Spain in Unusually Sharp Rift Over Iran Military Action
Trump Repeats UK Claims That Diverge from Verified Facts Amid Diplomatic Strain
UK Arrests Prominent Figures Linked to Epstein Network as Questions Mount Over US Action
Trump Says UK ‘Took Far Too Long’ to Approve Use of Airbases for Iran Strikes
Scope of Britain’s Role in the Expanding Middle East Conflict Comes Under Scrutiny
Trump Says He Is ‘Very Disappointed’ in Starmer Over Iran Comments
U.S. Embassy in Riyadh Struck by Drones Amid Escalating Iran Conflict
Starmer Confronts Strategic Test After Drone Strike Near British Base in Cyprus
Rolls-Royce Chief Signals Openness to Germany Joining UK-Led Fighter Jet Programme
UK Stocks Slip as Escalating Iran Conflict Triggers Global Market Selloff
UK Overhauls Asylum System to Make Refugee Status Temporary
Starmer Warns of ‘Reckless’ Iranian Strikes Amid Escalating Regional Tensions
British Base in Cyprus Targeted as Drones Intercepted Amid Expanding Iran Conflict
Starmer Diverges from Trump on Iran Strategy, Rejects ‘Regime Change from the Skies’
U.S. and Israel Intensify Strikes on Iran as Conflict Expands to Lebanon and Gulf States
Violent Pro-Iranian Protesters Storm U.S. Consulate in Karachi
Missile Debris Sparks Fires at Dubai’s Jebel Ali Port Near Palm Jumeirah
Iran Strikes U.S. Fifth Fleet Headquarters in Bahrain Amid Wider Gulf Retaliation
When the State Replaces the Parent: How Gender Policy Is Redefining Custody and Coercion
Bill Clinton Denies Knowing Woman in Hot Tub Photo During Closed-Door Epstein Deposition
Former U.S. President Bill Clinton Testifies on Ties to Jeffrey Epstein Before Congressional Oversight Committee
Dyson Reaches Settlement in Landmark UK Forced Labour Case
×