The Bank of Japan kept its policy rate at 1.25% on Friday but said for the first time that underlying inflation is in line with its 2% target, which keeps a December increase on the table. The yen firmed after the decision, while gold slipped below $4,000 an ounce as strong US growth and inflation data kept a December Fed rise in view.
This report was updated on Friday 30 October in early London trade, after the Bank of Japan decision and Governor Kazuo Ueda's press conference. UK time comes first, with New York time (ET) in brackets for US data. Short updates go out on our free Forexuro Telegram channel every trading day.
Free on Telegram. Follow our read on the yen, gold and the dollar through Friday's data on the Forexuro channel.
The Bank of Japan holds and sounds more confident on inflation
The Bank of Japan kept its short term policy rate at 1.25%, its highest level since 1995, in an 8 to 1 vote. Board member Hajime Takata voted for a rise to 1.5%. In its quarterly Outlook Report the bank said underlying inflation is now generally consistent with its 2% target, the first time it has said so since it adopted the target in 2013, and it raised its fiscal 2027 inflation forecast to 2.6% from 2.4%.
At his press conference Governor Kazuo Ueda said underlying inflation has reached levels consistent with the price target and that the bank must be vigilant to the risk of inflation overshooting it. Analysts quoted by Reuters saw the December meeting as a credible date for the next rise. Our Bank of Japan rate decision page explains how the statement and the press conference usually move the yen.
The yen firms after the decision
The yen strengthened to 157.115 per dollar after the statement, Reuters reported, which erased most of its losses for October. USD/JPY was near 157.65 in early London trade on Friday, below the 158.50 area that capped the pair in recent weeks. In USD/JPY one pip is 0.01, so a move from 158.00 to 157.00 is 100 pips; the pip value calculator turns that into your account currency before you size a trade.
How the pair trades around official comments from Tokyo is covered in our USD/JPY signals and the BoJ intervention risk guide.
US growth and inflation came in strong
The US economy grew at a 3.4% annual pace in the third quarter, faster than the 3.2% that economists expected and up from 2.2% in the second quarter, the Bureau of Economic Analysis said on Thursday at 12:30 UK time (8:30am ET). The PCE price index, the inflation gauge the Fed watches most closely, rose 0.5% in September and 3.6% from a year earlier, up from 3.4% in August. Core PCE rose 3.1% from a year earlier. Weekly jobless claims fell to 194,000.
Traders priced about a 75% chance of a Fed rate rise in December, according to the CME FedWatch tool cited by CNBC on Friday. Our US GDP and PCE inflation pages explain how those releases usually move the dollar. Traders in the US can follow the same free signals, and our forex signals for US traders page shows how.
Gold slips below $4,000
Gold fell below $4,000 an ounce in Asian trade on Friday. Investing.com had spot gold at $3,992.46 at 03:50 UK time, and it was near $3,984 in early London trade. The metal has lost more than 3% in October and is on course for a second monthly fall, because higher US rates make a metal that pays no interest less attractive. The dollar index slipped 0.3% to 101.79, Investing.com reported, as Treasury yields fell.
Live gold levels and today's events are on our XAU/USD today page, and the price per gram and ounce in several currencies is on gold price today.
The euro recovers from a 17 month low
EUR/USD fell to 1.1104 on Thursday, its lowest level since May 2025, FXStreet reported, after the European Central Bank kept its deposit rate at 2.5% and the US data came in strong. The ECB said rising energy prices pose upside risks to inflation, which reached 3.8% in September, and it announced that President Christine Lagarde will step down on 7 February 2027. The euro then recovered to about 1.1167 later on Thursday, Reuters said, and traded near 1.1186 on Friday morning.
GBP/USD was near 1.3400 on Friday morning, and the euro slipped to about 0.835 against the pound on Thursday. Live levels are on our EUR/USD today and GBP/USD today pages, and the EUR/USD signals for the Fed and ECB week explain how the pair trades when two central banks speak in the same week.
Friday and next week in UK time
Euro area flash GDP for the third quarter is due at 10:00 UK time on Friday, the US Employment Cost Index at 12:30 UK time (8:30am ET) and the Chicago PMI at 13:45 UK time (9:45am ET). The US Commodity Futures Trading Commission releases its weekly positioning report at 19:30 UK time (3:30pm ET), because UK and US clocks are out of step until Sunday.
US clocks change on Sunday 1 November, so from Monday US data at 8:30am ET lands at 13:30 UK time again. Next week brings the Reserve Bank of Australia on Tuesday 3 November at 03:30 UK time, the Bank of England on Thursday 5 November at 12:00 UK time and US non farm payrolls on Friday 6 November at 13:30 UK time (8:30am ET). Our guide to central bank rate decisions shows how forex and gold usually react on those days, and the full list sits in the economic calendar.
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Official sources
Official pages for the decisions, data and schedules behind this report.
- Bank of Japan: monetary policy meetings, the official schedule, statements and Outlook Reports.
- European Central Bank: monetary policy statement, 29 October 2026, the official statement behind the ECB hold.
- US Bureau of Economic Analysis: PCE price index, the official source for the Fed's preferred inflation gauge.
- Bank of England: upcoming MPC dates, the official dates for the next UK rate decisions.
Frequently asked questions
What did the Bank of Japan decide on 30 October 2026?
It kept its policy rate at 1.25% in an 8 to 1 vote. Board member Hajime Takata voted for a rise to 1.5%, and the bank said underlying inflation is generally consistent with its 2% target.
How did the yen react?
The yen firmed to 157.115 per dollar after the decision, and USD/JPY was near 157.65 in early London trade on Friday.
Why did gold fall below $4,000?
US third quarter GDP grew at a 3.4% annual pace and PCE inflation rose to 3.6% a year in September, which kept a December Fed rise in view. Spot gold was near $3,984 in early London trade on Friday.
What did the ECB do on 29 October?
It kept its deposit rate at 2.5% and said President Christine Lagarde will step down on 7 February 2027. EUR/USD touched a 17 month low of 1.1104 and then recovered.
What time is US data next week in UK time?
US clocks change on 1 November, so from Monday 2 November US releases at 8:30am ET come out at 13:30 UK time, including payrolls on Friday 6 November.
Sources
- CNBC: BOJ holds rates at 1.25%, says inflation target has been met
- Reuters via Investing.com: Yen gains after BOJ, Treasury rally weighs on the dollar
- CNA: BOJ Governor Ueda's comments at news conference
- FXStreet: Euro slides to a 17 month low as the ECB stands pat and PCE boosts the dollar
- Investing.com: Gold falls below $4,000 as inflation concerns keep bullion under pressure
- CNBC: Gold slips as higher oil and US inflation data bolster Fed hike bets
- Data for the charts: US Bureau of Economic Analysis figures for third quarter GDP and September PCE inflation as reported by FXStreet on 29 October 2026; times from the BEA, BLS, CFTC, RBA, Bank of England and Eurostat calendars.
Keep reading
XAU/USD today · EUR/USD today · Bank of Japan rate decision · Economic calendar