Free Trial
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
JPY
USD/JPY kept advancing towards the Y150.00 threshold as participants were keen to test the MoF's intervention strategy, as top officials reaffirmed their well-documented policy stance in parliament. Price action was volatile, with the pair staging a 110-pip pullback after lodging fresh 32-year highs in the London morning. It quickly found poise and resumed gains, climbing to a new multi-decade high of Y149.38 post-WMR fix.
- Daily gyrations in relative yields took a back seat, as spot USD/JPY got no reprieve from marginal narrowing in U.S./Japan spreads. The gap in yields on 2-year debt shrank 1.1bp, while 10-year differential tightened by 0.5bp.
- One-year implied volatility refreshed its best levels since March 2020, while its spread with one-month volatility rose to new monthly highs.
- FinMin Suzuki doubled down on intervention rhetoric this morning, vowing to increase the frequency of FX markets monitoring. Yesterday's bout of abnormal volatility served as a reminder that stealth interventions remain an option.
- Spot USD/JPY last seen -10 pips at Y149.16. Technically, trendline resistance drawn off Apr 28 high intersects at Y149.60, providing a tentative layer of resistance ahead of the psychological Y150.00 level. Bears look for a retreat towards Oct 5 low of Y143.53.
- BoJ Gov Kuroda will appear in parliament today, while Policy Board member Adachi will speak at a meeting with local leaders in Toyama later today.
Fig. 1: USD/JPY 1-Year Implied Volatility vs. USD/JPY
Source: MNI - Market News/Bloomberg
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
We are facing technical issues, please contact our team.
ok
Your request was sent sucessfully! Our team will contact you soon.
ok