The yen rallied during New York trading as USD\/JPY slid from 163.00 to 158.00 before rebounding, a move framed as likely Ministry of Finance intervention against a backdrop of broader US dollar weakness. The Bank of Japan then kept its key policy rate unchanged at 1.00%, with the decision passed by an 8-1 vote in a meeting that also delivered an updated Outlook for Economic Activity and Prices.<\/p>\n\n
In the outlook, the BoJ again pointed to upside inflation risks, while the wording placed greater weight on foreign exchange developments as a source of upward pressure; it also cited AI demand as an area requiring attention. The forecast for core nationwide CPI in FY2026 was revised down to 2.5% from 2.8%, while the FY2027 projection was raised to 2.4% from 2.3%, suggesting inflation pressures remain in view. Communication signalled further tightening but did not indicate a faster pace than the current six-month rhythm, leaving the policy backdrop unchanged even as the MoF\u2019s propensity to intervene more than once remains a live market consideration.<\/p>\n\n\n\n