TOKYO -- While the BOJ's decision to end negative interest rates hasn't stopped the yen from weakening, some analysts are beginning to expect that the yen's weakness will in turn lead to further rate hikes by the BOJ, a scenario in which weaker yen-driven inflation will prompt the hawkish voices in the central bank to become more vocal about rate hikes. However, long-term interest rates are calm and the bond market is hardly ready for another rate hike.
The Japanese currency has softened to the upper 151 range against the dollar for the first time in about 34 years. With the BOJ expected to keep monetary policy loose while U.S. interest rates remain high, traders have been selling yen to the point that market watchers see government intervention on the table.
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