USD/JPY daily chart
It’s not going according to plan for yen bulls to say the least. USD/JPY is now up another 0.5% today to 151.55 now, its highest level since November last year. The pair now looks poised to take a run at the high last year at 151.90 next. The rise here is a lot to do with the yen facing heavy selling pressures across the board. EUR/JPY is up 0.5% to 164.67 – its highest since 2008 – while GBP/JPY is up another 0.4% today to 192.75 after trading to its highest since 2015 yesterday.
At some point, the big picture ramifications from the BOJ policy move yesterday will come into play. But we’re not quite there yet. I’d argue that unless bond yields elsewhere start coming down more significantly, then only one can argue for a stronger rotation into the yen.
Funnily enough, we’re not seeing much verbal intervention here from Tokyo amid the rise in USD/JPY yesterday and today. Considering the BOJ pivot, are they perhaps looking to imported inflation to try and bolster the odds of normalising policy further in the bigger picture? Otherwise, you’d think that Japanese officials might at least trigger some murmurs about intervention at this point.