Business sentiment among large manufacturers worsened for the third straight quarter, a Bank of Japan survey showed on Monday, as the world's third largest economy grapples with rising costs, a weakening currency and slowing global demand. The headline measure for the tankan measuring sentiment among large manufacturers, was plus 8, down from plus 9 the previous quarter. The tankan measures corporate sentiment by subtracting the number of companies saying business conditions are negative from those responding they are positive. Japan has been trying to fight deflation in recent years and has kept interest rates at near zero. Prices have been rising, but at a more modest pace than in other major economies, and the Bank of Japan has not followed the lead of other central banks in raising interest rates. That means the yen has weakened relative to the surging dollar. That makes exports of autos and electronics more competitive in overseas markets and raises the value of overseas earn
The US dollar surged to a new 24-year high against the yen after the Bank of Japan stuck to ultra-easing stimulus
In a rate check, central bank officials call up dealers and ask for the price of buying or selling yen. However, actually intervening to support the currency would be a larger step.
Ten-year yields edged higher to 0.23% Monday in the aftermath of the BOJ's 10.9 trillion yen ($81 billion) of government bond purchases last week, the most on record
The central bank kept its policy settings for yield curve control and asset purchases, according to a statement on Friday, in line with the forecasts of almost all surveyed economists
Japan's yen has been battered by traders wagering that BOJ will stick with its ultra-accommodative policy stance just as the Fed and other central banks accelerate their tightening to tame inflation
While Tokyo's inflation is finally approaching the 2% level targeted by the BOJ, the April figures are unlikely to prompt the central bank to cut back its monetary easing
Some bigger companies have answered a government call to raise wages but the gains of some 2% will be swallowed up by higher prices of everything from flour, to diapers and beer, economists say
The yen dropped to a 20-year low after the Bank of Japan vowed to buy unlimited amounts of 10-year bonds daily to defend its yield target
The dollar shot past the key level of 130 yen after the BOJ strengthened its commitment to keep interest rates ultra-low
The dollar rose past the psychological level of 130 yen on Thursday for the first time since 2002, after the Bank of Japan (BOJ) doubled-down on its super-low yield policy
There had been some market speculation the BOJ might step back a little given inflation was rising and other major central banks were tightening, but it showed no hesitation
The U.S. dollar hit 129.43 yen on Wednesday for the first time since April 2002 earlier in the session, before easing to 127.79 yen, down 0.8%
"The BOJ has done the opposite of normalization. They have dug their heels in," said Richard Benson, co-chief investment officer at Millennium Global Investments in London
The US rate futures market has priced in 96% chance of a 50 basis-point hike at next month's Fed policy meeting, and about 215 basis points in cumulative rate increases
Against a basket of six major currencies, the dollar climbed to 100.52, the highest since May 2020, but was last little changed at 100.29
Japanese shares led gains in Asian stocks on Tuesday as the Bank of Japan defended its ultra-easy stance, while oil slid on fears of lower demand from China as Shanghai applied a "zero-COVID" strategy
The Japanese currency fell as much as 2.4% to 125.10 to the dollar overnight, its lowest since August 2015, before recovering to 124.24 in volatile morning trade in Tokyo.
The euro gained 1.27% to 135.895 yen, a four-year high.
Treasury yields rose further on Monday, with 10-year yields above 2.5% at a three-year high, boosting the dollar's index to a two-week high