Japanese Yen: Range-bound against US Dollar as markets price BoJ hike – Scotiabank

Scotiabank strategists Shaun Osborne and Eric Theoret describe the Japanese Yen (JPY) as quiet, extending a tight consolidation as markets gradually price a 25 bp Bank of Japan (BoJ) hike for September 18. Hawkish BoJ messaging is providing some support via spreads, while traders assess the tone for potential further tightening into 2027. For USD/JPY, the chart shows a flat range between support at 158.00 and resistance in the mid/upper-159s.

Yen steady with BoJ tightening in view

"The yen is quiet and extending its tight consolidation from last Thursday."

"Fundamental releases have been limited and messaging from the BoJ has remained hawkish, managing expectations for a 25bpt hike at the September 18 meeting."

"Markets are gradually pricing in a hike, offering scope for additional nearterm support via spreads."

"Messaging will be key as market participants assess policymakers’ tone and consider the prospect of additional tightening later this year and into 2027."

"For USD/JPY, the chart offers a flat range with movement roughly bound between support at 158.00 and resistance in the mid/upper-159s."

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