The USD/JPY pair has again approached the 147.00 level, after hitting a low of 145.11 yesterday, following the Bank of Japan’s announcement that it is leaving its monetary policy unchanged. Nevertheless, yield pullback outside of Japan is some relief for the yenreport economists at MUFG Bank.
The BoJ maintains a loose policy
“The continuation of the BoJ ultra-loose monetary policy leaves yen vulnerable to further weakness and maintains the responsibility of direct intervention to dampen the pace of yen selling.”
“The Japanese authorities are receiving at least a temporary relief from falling yields outside of Japan over the past week, which is helping to discourage speculative yen selling along with intervention risk. After peaking late last week, yields outside of Japan have pulled back sharply fueled in part by speculation about a dovish shift in central bank policy amid intensifying fears of a sharper slowdown in the worldwide economy.”
“Bank of Japan dovish policy stance continues to fuel yen weaknessbut downside risks are beginning to recede as global yields start to top out in the near term.”
Source: Fx Street
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