FX.co ★ Yen Weakens as Safe-Haven Appeal Diminishes

The Japanese yen weakened toward 158 per dollar on Wednesday, erasing most of last week’s safe-haven gains amid renewed optimism surrounding artificial intelligence. South Korean chipmaker SK Hynix reported strong third-quarter results and announced increased shareholder returns supported by AI-driven profits, further improving the sector’s outlook. At the same time, investors are looking ahead to the Bank of Japan’s policy meeting this week, where interest rates are widely expected to be left unchanged, though policymakers may signal a possible rate hike in December amid persistent inflationary pressures. Recent data showed that a key gauge of inflation in Japan’s services sector rose 3.7% year over year in September, its highest level since June 2024, as labor, transportation, and fuel costs remained elevated. Investors are also closely watching monetary policy decisions from other major central banks this week, which could shape the yen’s trajectory.