Yen Stumbles as BOJ Holds Back Hawkish Signals

The Japanese yen has hit near-record lows against major currencies following the Bank of Japan's cautious stance on monetary policy. Despite warnings of currency intervention from Japanese officials, the absence of hawkish signals caused a selloff in Japanese government bonds and downward pressure on the yen.

The Japanese yen hovered near record lows against the euro and Swiss franc on Monday. This slump comes amid a lack of hawkish signals from the Bank of Japan, further emboldening traders. Despite steps taken by Japanese officials to indicate potential currency intervention, the yen remains under pressure.

In early Tokyo trading, top financial officials warned of 'one-sided and sharp' currency movements. They hinted at a possible intervention. However, Bank of Japan Governor Kazuo Ueda maintained his cautious rhetoric despite an earlier policy rate increase to a three-decade peak of 0.75%.

The yen's value declined sharply against major currencies, causing a selloff in Japanese government bonds and a significant rise in the 10-year yield. Market watchers remain attentive to Governor Ueda's upcoming speech for any signals of future policy directions.

(With inputs from agencies.)