In the opinion of economists Societe Generaleauthorities are likely to intensify verbal intervention near the 145.00 zone in USD/JPY.
JGB yield range extension to 10 years in July
We now anticipate a widening of the 10-year JGB yield range from +/- 0.50% to 1.00% at the next meeting in July. However, this may depend on the FOMC meeting in the US. The outlook for USD/JPY is clouded by the BoJ’s calendar, but also by the Fed’s.
A further widening of UST/JGB spreads on the eve of the July meeting and an acceleration of USD/JPY above 145.00 could signal the return of FX intervention.
Speculation about a general election this fall also darkens the outlook for the currency and the BoJ’s policy tightening.
Source: Fx Street
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