Japanese Yen: Defensive Yen as BoJ turns hawkish – Scotiabank
Scotiabank strategists Shaun Osborne and Eric Theoret highlight that USD/JPY is edging higher as the Japanese Yen trades defensively after its sharp late-August rally. The Bank of Japan’s messaging is described as unequivocally hawkish ahead of a widely anticipated 25 bps hike on September 18.
Scotiabank strategists Shaun Osborne and Eric Theoret note that the Japanese Yen is trading defensively against the US Dollar following a sharp rally in late August. The Bank of Japan (BoJ) is signaling a hawkish stance ahead of a 25 basis point rate hike expected on September 18. In this scenario, the bank sees USD/JPY support around 153 and short-term resistance above 155.
The yen has recently slipped slightly against the USD and is demonstrating the first signs of weakness since its 3.7% rally on August 31. With a limited release calendar, the focus has shifted to the BoJ's messaging, which is now consistently hawkish in anticipation of the September 18 meeting. USD/JPY had previously identified 152 as a critical support level, but recent price action suggests that 153 is a more relevant level to watch.
Short-term resistance is identified at 155. This report is based on insights from FXStreet's team of journalists, who have reviewed and confirmed the information.
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