Yen Rises as BOJ Rate Hike Looms on September 18th

The Japanese yen has experienced a sharp recovery in value overnight as markets anticipate the Bank of Japan's (BOJ) decision to raise interest rates on September 18th.

According to Alasdair Macleod, this expected rate hike from 0% to 1.25% may not be sufficient to stop the carry trade into U.S. Treasury bills.

Macleod suggests that a continuing squeeze on yen short positions could be underway, which would contribute to the yen's rising value.