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    Traders of the Japanese Yen show indecision ahead of Fed and BoJ announcements as the European session begins

    by VT Markets
    /
    Oct 29, 2025

    Inflation Expectations and Exchange Rate Volatility

    Scott Bessent advises Japan to let the Bank of Japan (BoJ) manage its policies to keep inflation expectations steady and reduce exchange rate fluctuations. Kiuchi wants to examine how currency changes affect the economy and emphasizes the importance of avoiding sudden swings. Takaichi’s supportive approach to spending might delay the BoJ’s move to raise interest rates. Meanwhile, traders think a rate hike could happen in December or early next year, differing from the expected cautious stance of the Federal Reserve. Today, the US central bank is likely to lower borrowing costs by 25 basis points, with another cut possible in December, leading to a short-covering move in the USD/JPY pair. The USD/JPY shows a bearish double-top pattern, suggesting it may lose value. Oscillators indicate support between 151.10 and 151.00. If this support is broken, losses could extend towards 150.00, with minor support around 150.45. If the currency recovers past the recent peak of 152.20, it may run into resistance near 152.90-153.00. Breaking above 153.25-153.30 could bring back the 154.00 level and possibly push it to 154.75-154.80.

    Federal Reserve and Bank of Japan Updates

    The Bank of Japan will announce its interest rate decision after eight important meetings this year. A positive outlook from the BoJ would boost the Yen, while a negative or rate cut would not. The next announcement is set for October 30, 2025. We are entering a crucial 24 hours. The Federal Reserve will make its decision today, October 29, followed by the Bank of Japan’s update tomorrow. The market is anticipating a cautious Fed compared to a possibly aggressive BoJ. This situation creates a significant tension between the two currencies. Traders are understandably wary of making big moves before these important events take place. Create your live VT Markets account and start trading now.

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