09.04.202602:14:49UTC+00Yen Weakens as Dollar, Oil Rebound

The Japanese yen weakened toward 159 per dollar on Thursday, surrendering part of the previous session’s gains as both the US dollar and oil prices rebounded amid persistent uncertainty surrounding the US–Iran ceasefire. A senior Iranian official said elements of the ceasefire proposal had already been violated following new Israeli strikes in Lebanon, while Tehran continued to largely obstruct passage through the Strait of Hormuz.

On Wednesday, the yen had strengthened by as much as 1% after the ceasefire was announced, underscoring Japan’s vulnerability to disruptions in Middle Eastern oil supplies. Meanwhile, a former Bank of Japan official signaled that the central bank is likely to raise its policy rate this month to avoid falling behind in its efforts to contain inflation.

Investors are now focused on any guidance from BOJ Governor Kazuo Ueda ahead of the April 28 policy meeting, looking for signals similar to those he provided in December before the bank’s most recent rate hike.