Following the volatility on Friday, USD/JPY has gained bullish momentum early on Monday. However, in the view of MUFG Bank economists, Yield curve control is about to end, so the upward pressure on the yen will continue.
The YCC is still about to end
“The prospect of rising JGB yields appears to us to be at least partially priced in in the currency markets and the election of Ueda as Governor, if confirmed, will not change that expectation, and there is a risk that the strengthen further. But we don’t see Ueda’s election necessarily being very different from Amamiya’s, in terms of the course of monetary policy this year.”
“Our predisposition was that the yen strengthened And that’s still the case.”
“We continue to believe that yield curve control (YCC) is likely to come to an end and we see Ueda as a credible alternative to Amamiya, who will credibly adopt monetary policy changes, given that his tenure at the BoJ preceded Abenomics.”
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
