On October 14th, in the Tokyo foreign exchange market, the Japanese yen appreciated significantly against the U.S. dollar. This rise was fueled by increasing speculation that the Federal Reserve, the central banking system of the United States, may lower interest rates as early as next month. As traders reacted to this news, many opted to sell dollars and buy yen, pushing the exchange rate to around 146 yen per dollar.
The Federal Reserve’s decisions on interest rates can have a major impact on currency values. Lowering rates typically makes a currency less attractive to investors seeking higher returns, which can lead to a depreciation of that currency. In this case, the anticipation of a rate cut has led to a stronger yen.
Source: www3.nhk.or.jp