JPY leads G10 as BoJ hike bets grow – Scotiabank
The Japanese Yen (JPY) strengthens sharply as tightening expectations for the BoJ accelerate, driven by Governor Ueda’s latest hawkish remarks.

The Japanese Yen (JPY) strengthens sharply as tightening expectations for the BoJ accelerate, driven by Governor Ueda’s latest hawkish remarks. With markets now pricing a December hike and USD/JPY momentum turning bearish, attention shifts to support near the 50-DMA at 153.09, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.

Government signals openness to December rate hike

"The yen is strong, up 0.4% vs. the USD and outperforming all of the G10 currencies on the back of a continued repricing of tightening expectations for the BoJ."

"The short-term rates market is now pricing 22bpts for December 19, reflecting the latest hawkish comments from BoJ Gov. Ueda as he spoke to parliament. Markets are also cheering media reports of a shift in the government’s position, as officials are said to be willing to tolerate the BoJ’s decision to hike rates on December 19."

"USD/JPY is extending its recent bearish reversal and momentum is confirming the turn as the RSI has pushed below the neutral threshold at 50. We see limited near-term support ahead of the 50 day MA at 153.09."

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