USD/JPY Maintains Its Upward Momentum above 155.50 in the Wake of the BoJ Summary of Opinions

At approximately 155.60 during Thursday's early Asian trading hours, the USD/JPY pair maintains its fourth consecutive day in positive territory. Fear of additional intervention by the Bank of Japan (BoJ) is likely to temporarily halt the decline of the Japanese Yen (JPY).

During their April monetary policy meeting, the BoJ board of directors resolved to maintain the key interest rate at 0%. As per the Summary of Opinions from the Bank of Japan (BoJ), board members adopted a more aggressive stance during their April policy meeting. A significant number of policymakers advocated for a consistent interest rate in order to prevent inflation overshoot risks. Recent remarks by BoJ Governor Kazuo Ueda that hinted at the likelihood of multiple rate hikes and an increase in short-term borrowing rates in the future months were emphasized in the statement.

Masato Kanda, Japan's highest-ranking currency diplomat, issued a verbal intervention early on Wednesday, stating that he would take action to prevent the JPY if required. Kanda nevertheless avoided providing a comment regarding the FX intervention. The possibility that the Japanese government will take additional measures to prevent the use of its currency could strengthen the JPY and limit the pair's upside.

The monetary policy divergence between Japan and the United States, on the other hand, continues to support USD/JPY. In contrast, Boston Fed President Susan Collins predicted on Wednesday that the interest rate will likely remain elevated for an extended period of time, as achieving inflation within the targeted range will require more time than initially anticipated. The hawkish remarks made by Federal Reserve officials provide a tailwind for the duo and elevate the Greenback. In addition, on Friday, traders will closely observe the preliminary Consumer Sentiment Index from the University of Michigan. This index is projected to decline from 77.2 in April to 76.0 in May.