The Japanese Yen (JPY) enters today's risk event with decent momentum, having appreciated over 2% in the past seven days, ING’s FX strategist Francesco Pesole notes.
Markets remain relatively hesitant about a BoJ move by year-end
“Overnight, Bank of Japan Governor Kazuo Ueda maintained a generally hawkish tone in a likely attempt to show independence from the recent turmoil in the Japanese stock market.”
“Further rate hikes are on the table, and the marginal CPI surprise (2.8% vs 2.7% year-on-year) this morning is also helping the hawkish case. Markets remain relatively hesitant about a move by year-end though, with only 10bp priced in by December. We think the chance of a hike is – once again – underpriced.”
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