BoJ Hike Fully Priced: Japanese Yen Underperforms G10 Peers
Market participants are pricing in a Bank of Japan (BoJ) hike as the Japanese Yen underperforms its G10 peers, Scotiabank strategists Shaun Osborne and Eric Theoret observe. The pair's trading higher against the US Dollar (USD), with risks centered around the BoJ's tone and guidance on future moves.
The strategists emphasize support levels for USD/JPY at 153 and 152, while identifying 155 as a key resistance level. With a hike widely expected, the focus is on the central bank's guidance on the pace of future hikes, with one additional hike almost fully priced before year end.
Osborne and Theoret also highlight the importance of broader themes, including market tone and the Federal Reserve (Fed), in influencing USD/JPY. They note that domestic developments, such as trade data and Consumer Price Index (CPI) releases, are also contributing to the pair's movement ahead of the BoJ policy decision.