USD/JPY Tumbles Near Four-Month Low Amid Hawkish BoJ Comments

The USD/JPY pair has flattened at around 156.00 at the start of the week, but is close to its four-month low of 155.23.

This comes after the JPY outperformed last week due to hawkish remarks from BoJ's board member Hajime Takata.

Analysts at MUFG note that there were significant moves in the FX market, with the Japanese yen strengthening sharply from 160.00 on September 2 to as low as 155.30 overnight, a five-figure move.

They attribute this to the policy backdrop, highlighting that BoJ's hawkish commentary has left the door open for an outsized interest rate increase and back-to-back hikes.