BoJ hawkish committee member Takeda So: Continuous rate hikes cannot be ruled out, yen rebounds to the 159 range.

One of the most hawkish members of the Bank of Japan, Kuroda Haruhiko, stated that he does not rule out the possibility of significant interest rate hikes and consecutive rate increases, which spurred an increase in the yen. The yen rose 0.5% against the dollar to 159.44 yen per dollar, after previously dipping to 160.39. Kuroda indicated that a 0.25% rate hike is "not set in stone." He also added that, overall, consecutive rate hikes are also a possibility. Morioka Eiichiro, Chief Market Strategist at Aozora Bank, commented, "The market reacted to Kuroda's clearer wording, as he explicitly mentioned the possibility of consecutive rate hikes. His remarks were more definitive than those of the Bank of Japan's Governor and Deputy Governor previously, particularly regarding the magnitude and pace of rate increases." High international oil prices and the significant disparity between U.S. and Japanese interest rates continue to put pressure on the yen. Although Japanese authorities have already intervened in the foreign exchange market with a record $96.4 billion over the past month, investors remain highly alert to the possibility of further interventions to support the yen. The yen has retraced much of its gains following the historic joint intervention between Japan and the U.S. in July. Bank of Japan Governor Ueda Kazuhiro stated after the G20 meeting that risks related to rising prices will be considered in monetary policy decisions, reinforcing market expectations for a rate hike at the policy meeting later this month. Overnight index swap market data shows that the probability of a rate hike in September is approaching 100%. Ueda's remarks came as U.S. Treasury Secretary Yellen called on the Bank of Japan to take appropriate policy actions, fueling market speculation about rate hikes. However, Japanese Finance Minister Katayama Sakurako downplayed this view. According to meeting minutes released by the U.S. Treasury Department on Tuesday, Yellen "strongly supports Japan taking decisive market and monetary policy measures to address the issue of the yen being significantly undervalued, noting that the weakness of the yen is exacerbating domestic inflationary pressures in Japan."