Yen moves but holds gains after BOJ allowed 10Y yield to rise as much as 1%. Scotiabank economists discuss the outlook for the yen.
The BOJ introduces changes to its YCC policy
The BOJ is keeping its 10Y yield target at 0%, but from now on it will consider 0.5% as a benchmark and will tolerate returns as low as 1%.
The official Bank of Japan interest rate remains at -0.1% and Governor Ueda stated that the BOJ is a long way from being able to tighten its monetary policy.
Rising long-term yields in Japan should support the Yen as US-Japan spreads have the opportunity to squeeze a bit more going forward.
The yen has been the furthest laggard in the G10 currency movement against the dollar this year, so even moderate yen strength will add to the DXY headwinds.
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.
