As I have recently observed, the trend movement of the yen in 2564 remains a closely watched topic among Asian investors, especially as the yen is testing its historic lows.

What’s interesting is that over the past ten years, the yen has depreciated by more than 30% against the baht. The JPY/THB exchange rate is currently trading at 0.2176 baht per yen, which is slightly above the long-term support level, but still near the lows.

The main reason for the yen’s depreciation comes from differing monetary policies. Japan continues to pursue a very accommodative monetary policy, with negative interest rates (-0.1%) and yield curve control (YCC). Meanwhile, the U.S. and European central banks have started to adjust their policies. It is this interest rate differential that keeps the yen weak.

However, signs of change are emerging. In the second quarter of 2025, the Bank of Japan reduced its bond purchases from 9 trillion yen to 7.5 trillion yen. This suggests preparations to exit the most ultra-loose phase of policy, which could bring the yen a slight rebound.

When it comes to the yen outlook, for the remainder of 2025 and into 2026, the key factors to watch are:

First, global inflation and interest rate differentials. If the Fed continues to cut interest rates but Japan tightens its policy, this differential could support the yen strengthening.

Second, the direction of Japan’s monetary policy. A clear exit from easing would strongly support the yen, but if the shift is carried out slowly, it could limit the extent of the rebound.

Third, Japan’s economy is expected to be the world’s fifth-largest in 2025, with GDP of approximately $4.19 trillion, highlighting the importance of monitoring Japan’s economic conditions.

For late 2025, if events unfold as expected, the yen may recover to the 0.2250–0.2300 range. But if Japan’s policy does not change clearly, the yen could test new lows.

Entering 2026, the long-term chart of JPY/THB shows a continuing downward trend since 2012. If support at 0.2150 holds, the yen could gradually strengthen toward 0.2300–0.2400. However, if it cannot maintain this base, the yen could test new lows below 0.2100, especially if Japan continues to ease its policy.

An important factor that is often overlooked is that the yen continues to function as a global safe-haven asset. Therefore, if geopolitical risks or a financial crisis emerges, the yen could appreciate rapidly. In addition, conflicts in Asia could increase demand for the yen as a regional safe-haven asset.

Based on current technical indicators, seven indicators signal sell, one indicates buy, and five are neutral. This suggests downward pressure on the yen in the short term, but long-term support levels may also indicate a potential reversal if market sentiment changes.

Overall, the yen trend in 2564 and continuing into 2026 will largely depend on decisions by the Bank of Japan. 2025–2026 could be a crucial turning point, because Japan’s monetary policy may shift from easing to tightening. Traders and investors should closely monitor BOJ policy signals, as this change will significantly affect exchange rates and the Japanese stock market.