Japanese Yen: BoJ September risk looms in flat range against US Dollar – Scotiabank

Scotiabank strategists Shaun Osborne and Eric Theoret note USD/JPY trading in a relatively flat range between 158.00 and the mid-159s as the Japanese Yen (JPY) underperforms most G10 currencies. Media reports of major banks shifting Bank of Japan (BoJ) tightening calls to September have lifted pricing to about 20 bp, leaving room for further upside, while markets focus on the central bank’s tone beyond the September 18 meeting.

Yen soft as BoJ expectations shift

"The yen is soft, down a fractional 0.1% vs. the USD and underperforming all of the G10 currencies with the exception of NOK."

"Fundamental releases have been limited however media are reporting of high profile adjustments to BoJ forecasts as major banks shift their tightening calls to September."

"The meeting is still only priced at 20bpts, leaving some room for further near-term upside."

"Greater risk will center around the central bank’s tone as market participants look beyond the September 18 meeting."

"For USD/JPY, we note the recent flat trading range roughly bound between 158.00 and the mid-159s."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)