USD/JPY indicating a big figure lower than Friday after ‘exit’ comments from BOJ Gov Ueda

A Japanese media report over the weekend, I posted earlier here:

Yomiuri report:

  • The Bank of Japan has entered a phase of reducing monetary easing. In an interview with The Yomiuri Shimbun, BOJ Gov. Kazuo Ueda described the monetary policy modification decided in July as “a mechanism to change the balance between the effects and side effects” of monetary easing measures. The focus will now be on “a quiet exit,” which the BOJ is seeking to avoid significant impact on the market.
  • Ueda said, “It is not impossible that we will have enough by the end of the year to anticipate [wage hikes next spring].” He cited the end of the year as a possible time to assess the trend of wage increases, a key factor in setting price increases. Ueda also said that “there are some things we cannot see,” including overseas economies, and expressed his cautious approach.

USD/JPY is indicating circa 146.85 after closing in Americas trade on Firayt about a hundred points higher than that.

Every Monday I emphasise that liquidity is thin until more Asian centres come online.

This makes this time of the FX week particularly susceptible to huge changes on little volume. Remember, FX is an OCT market, so you are not going to see these moves much of the time, there is no centralised reporting

This article was written by Eamonn Sheridan at Source