Bank of Japan holds steady, Japanese yen hits resistance at 159.5: A possible rate hike in June is the next thing to watch

The Bank of Japan will convene its Monetary Policy Meeting on April 27–28, and markets expect the policy rate to remain unchanged at 0.75%. The yen is currently trading at about USDJPY 159.5 against the U.S. dollar, and it has once again pushed back into a resistance zone. On April 27, “yen” jumped more than 5,000 times in Taiwan’s Google Trends hot searches, reflecting that Taiwan investors’ attention to the yen’s price movement has reached a high point this year.

BOJ holds steady: The real watchpoint is the June meeting

Market consensus is that the BOJ will “hold steady” at this meeting and defer the decision on additional rate hikes to the June meeting. There are two background factors: first, the situation in the Middle East remains unclear, and the standoff involving the Hormuz Strait has pushed up oil prices, creating cost pressure for Japan, which is an oil-importing country; second, the BOJ has recently continued to issue “hawkish signals” via CPI releases beyond special factors, suggesting that prices may keep rising. Nomura Securities’ Kyowhei Morita has included one more rate hike in 2026 and one more in 2027 among the main scenarios.

USDJPY 159.5 hits resistance: Soaring oil prices are the biggest pressure

The yen has recently slid again toward the USDJPY 160 round-number level. Over the past week, oil prices have surged by more than 5%, creating structural downside pressure on the yen. Japan is the world’s largest liquefied natural gas importer and the second-largest crude oil importer; for every $10 increase in energy prices, the trade deficit can expand by more than 1 trillion yen. With the Middle East situation still unclear, it is difficult for the yen to return below 155.

What it means for Taiwan investors: Three lines—Japan stocks, importers, and outbound travel

The yen’s continued weakness has specific impacts on three types of Taiwan investors: (1) investors holding Japan stocks / Japan stock ETFs (00714, 00919 with partial allocations) may see relatively lower costs, and their returns could be partially offset by FX losses; (2) costs for Japan-related importers fall, expanding gross margins, but they need to assess the cost of insuring against FX losses; (3) Japan’s travel demand remains hot, benefiting the Japan payment-side digital channels (including the Lightning Network).

The next trigger: the June BOJ meeting + the Middle East situation

The next important time window is the June BOJ Monetary Policy Meeting. If the Middle East situation eases by then and oil prices pull back, the BOJ may formally begin its second rate hike of the year, pushing rates up to the 1.0% round-number level—this would be the first time since 2007 that Japan has seen “normalized interest-rate levels.” For the yen, this is a key turning point for a medium-term shift from weak to strong, but it will first require watching two signals at once: the Middle East situation and the pace of interest-rate hikes and cuts in the U.S.

This article, “BOJ holds steady, yen 159.5 hits resistance: June rate hike is the next observation point,” first appeared on Lian News ABMedia.