BOJ Hike Risk Returns Amid Surging USD/JPY Volatility

The USD/JPY volatility has increased due to Bank of Japan policymaker Hajime Takata's comments on adjusting interest rates in response to inflation. According to Takata, a more nimble approach is needed, which potentially increases the importance of each BOJ meeting and puts Japanese rates back into focus.

The sharp yen move late in the Asian session raised questions about whether Japanese authorities had stepped back into the market. The British pound has fallen again, with traders watching for Japanese headlines due to its impact on currency markets.