The Bank of Japan's interest rate hike failed to stop the decline of the yen, and the yen exchange rate is approaching a 40 year low

According to Reuters, despite the Bank of Japan raising interest rates last week and the Japanese Ministry of Finance intervening in the foreign exchange market this year, the yen against the US dollar is still hovering near a nearly 40 year low. On Friday, the US dollar was at 161.12 against the Japanese yen. Federal Reserve Chairman Kevin Walsh's hawkish stance has pushed up the US dollar, and Japan's core inflation is below the Bank of Japan's 2% target. Prime Minister Takashi Hayao's fiscal spending plan has raised concerns in the market about the fiscal situation. DBS Bank stated that the short positions in the Japanese yen were not significantly replenished after the Bank of Japan raised interest rates. The market expects that when the US dollar/Japanese yen exchange rate approaches the level of 161.95, the Japanese Ministry of Finance may intervene in the exchange rate again. According to CME FedWatch data, the probability of the Federal Reserve raising interest rates by 25 basis points in July has risen to 38.5%.