USD/JPY: Fell Back for Re-Test of 107.60 - BTMU
Analysts at Bank of Tokyo Mitsubishi explained that the yen has
strengthened sharply following the BoJ’s “surprise” decision to leave
monetary policy unchanged.
Key Quotes:
"Our
analysts in Tokyo had correctly cautioned that the BoJ were unlikely to
ease policy further so the decision was not entirely a surprise.
However,
it is clear that the BoJ has chosen to disappoint market expectations
for easing which had stepped up late last week following the release on
Friday of a Bloomberg report suggesting that the BoJ were considering
lowering the interest rate on reserves and introducing a negative rate
on the BOJ’s Support for Lending program."
"The report proved
misleading as Governor Kuroda stated in the press conference that the
BoJ did not even discuss introducing a negative rate on the BOJ’s
Support for Lending program.
As a result, it is not surprising
that USD/JPY has quickly reversed the temporary spike higher to the
112.00-level and is now falling back towards a likely retest of the
recent lows at around 107.60."
