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Oct 20 - 12:55 PM

USD/JPY: On Alert For Intervention - Credit Agricole

By eFXdata  —  Oct 20 - 11:00 AM

Credit Agricole CIB Research flags a high risk for BoJ's intervention around the current levels in USD/JPY.

"USD/JPY has traded a 75-150 range for several decades and so a break of this range would lead to significant volatility. While the MOF has said it is not focused on levels in JPY and is instead focused on volatility, a jump in volatility should the exchange rate breach 150 would likely trigger intervention. On our verbal intervention scale, Finance Minister Shun’ichi Suzuki has reached 7 out of 7, with 7 warning of imminent intervention," CACIB notes. 

"Outside higher UST yields and the threat of intervention, USD/JPY will also be paying attention to Japan inflation data released on Friday where any significant acceleration would place more pressure on the BoJ to pivot away from its ultra- dovish policy stance," CACIB adds.

Source:
Cr├ędit Agricole Research/Market Commentary

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