MUFG Bank fixes yen at 155.15/dollar, 0.36 weaker

MUFG Bank fixes yen at 155.15/dollar, 0.36 weaker

MUFG Bank Fixes Yen at 155.15/Dollar Amid Weakening Trend
On February 19, 2026, MUFG Bank set the yen at 155.15 per U.S. dollar, reflecting a 0.36% decline from previous levels, signaling continued pressure on the Japanese currency. The yen’s weakness aligns with broader market dynamics, including Japan’s softer-than-expected Q4 2025 GDP contraction of 0.2%, which dampened expectations for aggressive Bank of Japan (BoJ) rate hikes. This follows a pattern observed earlier in 2025, where weak economic data curbed yen strength and pushed USD/JPY above key support levels.

The BoJ’s recent policy updates have also failed to reverse the yen’s downward trajectory. Despite markets pricing in a 25 basis point rate hike at its December 2025 meeting, the central bank’s guidance for "gradual tightening" has not been sufficient to offset fiscal concerns in Japan, including a high debt-to-GDP ratio. Analysts note that without stronger growth momentum, further BoJ tightening may struggle to bolster the yen.

Meanwhile, the U.S. dollar remains resilient amid persistent inflation. The January 2026 U.S. CPI report showed a 3.2% annual inflation rate, reinforcing expectations that the Federal Reserve will maintain higher-for-longer interest rates. This widening interest rate differential between the U.S. and Japan continues to pressure USD/JPY higher.

Market participants are closely watching key support levels for USD/JPY, currently anchored near 155.00, with the 200-day moving average at 150.60 providing a longer-term reference. Derivative strategies, such as buying USD/JPY call options above 159.00 or selling out-of-the-money puts, reflect positioning for further dollar strength.

As Japan grapples with structural economic challenges and the BoJ navigates a cautious tightening path, the yen’s near-term outlook remains vulnerable to cross-currents between domestic fiscal policy and U.S. monetary conditions.