JPY Policy Follow-Up Needed for Renewed Demand, Says BNY's Geoff Yu

BNY's Geoff Yu argues that coordinated intervention in the Japanese Yen (JPY) has not significantly increased foreign exposure, and investors remain net long JPY but at lower levels than in H1 2026.

The Bank of Japan (BoJ) needs to follow through with credible domestic policy changes, such as tightening monetary policy, fiscal consolidation, and structural reform, to raise real rates and attract portfolio inflows.

Intervention buys time but doesn't create conviction, according to Yu. He believes that Japanese equities remain largely passive and under-supported, while Japanese government bonds (JGBs) are attracting marginal demand.