The yen weakened against major currencies after the Bank of Japan (BOJ) announced it would maintain its current monetary policy. The central bank’s decision reinforced expectations that Japan would continue its aggressive stimulus program for the foreseeable future.

The BOJ’s announcement triggered a sell-off of the yen, as investors anticipated that Japanese interest rates would remain low relative to other major economies. This interest rate differential makes the yen less attractive to investors seeking higher returns.

Analysts suggest that the BOJ’s commitment to its current policy reflects concerns about the fragility of the Japanese economy. While there have been some signs of improvement, the BOJ appears to believe that further stimulus is necessary to achieve its inflation target.

The yen’s weakness could provide a boost to Japanese exporters, making their products more competitive in global markets. However, it could also lead to higher import prices, potentially squeezing household budgets.

The market’s reaction underscores the sensitivity of the yen to changes in monetary policy expectations. Investors will continue to closely monitor the BOJ’s actions and statements for clues about the future direction of monetary policy.

The yen weakened on Tuesday after the Bank of Japan (BOJ) opted to maintain its ultra-loose monetary policy, further diverging from other central banks that are raising interest rates to tackle inflation.

The BOJ’s decision reinforced expectations that it will remain an outlier in the global tightening cycle. The central bank has repeatedly stated its commitment to maintaining its current policy stance until it sees sustained inflation driven by stronger domestic demand.

The dollar rose against the yen following the announcement. Other currencies, including the euro and the British pound, also gained ground against the Japanese currency.

Analysts expect the yen to remain under pressure as long as the BOJ maintains its dovish stance. The widening interest rate differential between Japan and other major economies is likely to continue to weigh on the currency.

The BOJ’s next policy meeting is scheduled for September, and market participants will be closely watching for any hints of a potential shift in its monetary policy outlook.