USD/JPY Range-Bound as BoJ Hike Expectations Take Center Stage

The Japanese yen is trading within a narrow range against the US dollar as markets price in a potential rate hike by the Bank of Japan, according to Scotiabank.

This range-bound behavior reflects a tug-of-war between expectations for BoJ tightening and the resilience of the US economy.

Scotiabank's analysis suggests that traders are positioning for a possible BoJ rate increase, which would narrow the interest rate differential between the US and Japan.