The USD/JPY reached a three-decade high above 156 after the Bank of Japan kept interest rates on hold on Friday.
At the time of writing, the USD/JPY was up 0.72% at 156.77, as market expectations for intervention by the Japanese authorities increased.
At the end of the two-day meeting, the Bank of Japan's board members decided to keep interest rates in the 0-0.1% range, which was in line with market expectations.
In addition, the Bank of Japan presented its updated forecast for the development of the country's economy.
This decision was taken by the markets as confirmation that the Bank of Japan does not intend to actively change its monetary policy, Reuters reported.
"There are few signs that the Bank of Japan is considering raising interest rates in the near future," Prashant Newnaha of TD Securities said.
Meanwhile, the analyst pointed out that the BoJ's policy decision favors a bullish trade on the yen and could push the USD/JPY pair into the 160-161 range.
At the same time, markets are now awaiting the US PCE price index data, which could put more pressure on the yen.
Despite frequent warnings of intervention from the Japanese authorities, markets believe that the government is unlikely to strengthen the yen due to the large interest rate differential between the Federal Reserve (Fed) and the Bank of Japan.
The EUR/JPY and GBP/JPY were up 0.71% and 0.67% to 168.19 and 196.08, respectively.
Similarly, the AUD/JPY and NZD/JPY pairs fell 1.07% and 0.87% to 102.55 and 93.39, respectively.
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