The Bank of Japan kept its policy rate at 1.0% at its July meeting while maintaining a tightening bias. Japan’s Ministry of Finance confirmed a currency intervention on July 30 involving yen buying and dollar selling, which only temporarily weakened USD/JPY before the pair recovered. The interest rate gap between Japan and the United States remains wide enough to keep the yen carry trade attractive for many investors. This situation could pressure the yen carry trade, a major funding source for leveraged risk assets including Bitcoin. Faster BoJ rate hikes or another surge in the yen could accelerate deleveraging across crypto markets.
Source: Read the original article
