Author: Kevin Buckland
Article: Original Article
Publication date: Tuesday, December 20, 2022
On Tuesday, Yen appreciated against the dollar after BOJ declared the intention to review its yield curve control policy and suddenly widened the trade corridor for the 10-year government bond yield.
BOJ left the general policy parameters unchanged and fixed the short-term yield of JGB at -0.1% and the yield of 10-year bonds near zero. But it increased the available range for the long-term yield from 25 basis points to 50 basis points on either side.
The branch manager at State Street in Tokyo Bart Wakabayashi said that he sees how the regulators start to test the market concerning the policy change strategy. After these actions, we will see the breakthrough of the USD/JPY currency pair below 130. Such a scenario is possible even this year.
Forecast: Japanese yen continues to strengthen