Yen Recovery Hinges on Faster BoJ Normalization, OCBC Says
OCBC analysts note a sharp rise in expectations for a September Bank of Japan hike, while the yen has so far shown only a limited reaction.
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OCBC strategists Sim Moh Siong and Christopher Wong point out that market pricing for a September rate increase by the Bank of Japan has climbed sharply. Despite that shift, the Japanese yen has reacted only modestly, according to their note.
That suggests a sustained recovery in the yen would require a faster pace of policy normalization from the BoJ. The analysts flag the currency’s limited response even as near-term hike expectations have strengthened.
Source: FXStreet Forex News