USD/JPY: Fell Back for Re-Test of 107.60 - BTMU

USD/JPY: Fell Back for Re-Test of 107.60 - BTMU

28 April 2016, 20:25
Roberto Jacobs
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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."


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