The Japanese yen declined in the Asian market on Thursday against a basket of major and minor currencies, deepening its losses for the fourth consecutive day against the U.S. dollar. It reached its lowest level in nearly two weeks as investors focused on buying the American currency as the preferred alternative investment amid escalating tensions between the United States and Iran in the Strait of Hormuz, where both sides have exchanged control over ships and oil tankers.

Despite the current rise in global oil prices, the probability of the Bank of Japan (BoJ) raising interest rates during its April meeting remains weak. Most speculation suggests the bank will abandon its hawkish stance due to risks associated with the repercussions of the Iranian war.

Price Overview

- Japanese Yen Exchange Rate Today: The dollar rose against the yen by 0.15% to (159.68), the highest since April 13, from todays opening price of (159.44), and recorded a low of (159.30).

- The yen ended Wednesday's trading down by 0.1% against the dollar, its third consecutive daily loss, due to escalating tensions between the United States and Iran.

The U.S. Dollar

The dollar index rose by more than 0.1% on Thursday, extending its gains for the third consecutive session and reaching its highest level in over a week. This reflects the continued rise of the American currency against a basket of global currencies.

This ascent comes as investors focus on buying the U.S. dollar as a safe haven, as the United States and Iran remain at odds over the ceasefire, the blockade, nuclear files, and control of the Strait.

These disputes keep the strategic waterway effectively closed and threaten an energy sector shock that could damage global economies.

Skye Masters, head of markets research at National Australia Bank, stated: "Despite Trump's extension of the ceasefire, tensions remain high with Iran's refusal to reopen the Strait of Hormuz and the continued U.S. naval blockade, increasing the risk of prolonged supply disruptions."

Masters added that extreme economic and trade risks are undervalued, and inflationary pressures will persist until the end of the year.

Iranian War Updates

- The United States intercepts three Iranian oil tankers in Asian waters.

- Iran seizes two cargo ships in the Strait of Hormuz on Wednesday.

- Navigation in the Strait of Hormuz is nearly at a standstill.

- The United Kingdom announced that two vessels were attacked in the Strait of Hormuz.

- Trump hints at the possibility of a second round of negotiations in Pakistan tomorrow, Friday.

- Iranian Parliament Speaker and chief negotiator Mohammad Bagher Ghalibaf stated that a full ceasefire would only be logical if the blockade is lifted.

Global Oil Prices

Global oil prices rose by more than 4% on Thursday, extending gains for the fourth consecutive day and reaching a two-week high. This comes amid mounting fears of energy supply disruptions from the Arabian Gulf region as the Strait of Hormuz remains closed to oil tankers.

Undoubtedly, the rise in global oil prices renews fears of accelerating inflation, which may push global central banks to raise interest rates in the near terma sharp shift from pre-war expectations of cutting or holding rates steady for a long period.

Japanese Interest Rates

- The Bank of Japan is expected to abandon its hawkish stance during its meeting next week, despite keeping interest rates steady.

- Governor Kazuo Ueda has recently refrained from pledging to raise interest rates in April, given the war's impact on economic projections.

- Market pricing for the probability of the Bank of Japan raising interest rates by a quarter percentage point in April is currently stable around 10%.

- To re-price these probabilities, investors await further data on inflation, unemployment, and wages in Japan.