Recently, driven by expectations of fewer and smaller rate cuts by the Federal Reserve and the prospect of a rebound in US inflation, the US dollar has continued to rise, while the Japanese yen has weakened significantly. On a certain date, the yen-to-dollar exchange rate briefly dropped to ¥151.94 per dollar, marking the lowest level since October 20th.

The widening interest rate differential between Japan and the United States remains a key factor in the continued weakness of the yen. Currently, the market is closely watching for clues on whether the Bank of Japan (BOJ) will raise interest rates. On a certain date, BOJ Governor Kazuo Ueda mentioned the future path of monetary policy in a speech. Ueda stated that monetary policy would be further tightened in the future, but did not explicitly indicate the timing of any rate hikes.

In his speech, Kazuo Ueda did not mention whether the Bank of Japan would further raise interest rates at the monetary policy meeting held from the 20th to the 21st of this month. Instead, he emphasized that it would continue to be guided by some economic data, stating that "the timing of the next monetary policy adjustment will depend on the developments in future economic activities, prices, and financial conditions." Ueda also noted that the Bank of Japan needs to carefully observe various risks.

Due to Ueda Kazuo's latest speech being milder than market expectations for hawkish remarks, the yen has continued to weaken against the dollar following the speech. As of the latest report, it is hovering above the dollar-to-dollar level. Analysts from Sony Financial Group stated, "Before Ueda Kazuo's speech, there were speculations that he would deliver hawkish remarks, as the yen had already depreciated to above the dollar-to-yen level."

Given that Kazuo Ueda did not hint at the possibility of another rate hike at the upcoming monetary policy meeting in his speech, the yen may depreciate further. Analysts from UBS Group also stated, "Kazuo Ueda is more cautious than expected." In the long term, the analyst anticipates that by the end of the year, the US dollar will appreciate further, putting continued pressure on the yen.

Analysts from Sony Financial Group also stated that the likelihood of the Japanese government intervening in the foreign exchange market has significantly increased, which could provide short-term support for the yen. In response to the recent weakness of the yen, Japanese Finance Minister Katsunobu Kato said at a press conference on the 10th that appropriate measures would be taken against excessive fluctuations in the exchange rate. "We have recently seen one-sided large fluctuations in the foreign exchange market. We will take appropriate actions against excessive fluctuations, while monitoring market movements with 'high vigilance'." At that time, after Kato's remarks, the yen temporarily appreciated against the dollar, rising to 145.5 yen per dollar on the evening of the 10th.