JPY outperforming on BoJ – Scotiabank
The Japanese Yen (JPY) is strong, up 0.6% against the US Dollar (USD) and outperforming all of the G10 currencies on the back of hawkish comments from a noted BoJ dove, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.
Near-term USD/JPY weakness through 147.77 is possible
"BoJ board member Noguchi’s latest speech suggested that upside risks required ‘a new policy perspective’. These comments have been interpreted as an endorsement of rate hikes, firming expectations for tightening at the next meeting on October 30."
"Yield spreads are narrowing, offering renewed support for the yen as the options market hints to a rise in demand for protection against JPY strength. We look to near-term USD/JPY weakness through the 50 day MA (147.77) toward the September lows around 146.00"
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