USDJPY Market Talk

suryatapa.bhattacharya@wsj.com; @SuryatapaB

BOJ Gov. Haruhiko Kuroda is no longer seen as the no-change candidate by markets, says Naka Matsuzawa, chief Japan rates strategist with Nomura. When he talked about reverse rates in a Zurich speech, he effectively started the argument in favor of a possible policy change. A 2nd term for Kuroda will now help smoothe the market response to a possible increase in yield rates, Matsuzawa says, since it gives the BOJ the possibility of communicating its intentions earlier. Matsuzawa expects the bank to raise its 10-year yield target to 0.25% from zero, a move that could be fully discounted by markets as soon as April with frequent BOJ signals and communication

The Nikkei continues to reverse the rest of this week’s decline, pushing to session highs ahead of the midday break in currently sitting up 1.2%. The ongoing rebound follows an overnight gain for dollar-yen, now approaching Y113.40 versus Y113.08 in late New York and early Tokyo trading. Oanda’s Stephen Innes thinks the pair could have gained further–and added even more to stocks’ bounce–if it weren’t for the yield-curve-control debate after Kuroda “recapitulated his hawkish deterrent overnight.” (suryatapa.bhattacharya@wsj.com; @SuryatapaB)

Dow Jones/WSJ News Wire

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Stephen Innes

Stephen Innes

Head of Trading APAC at
Stephen has over 25 years of experience in the financial markets and currently based in Singapore as the Head of Trading Asia Pacific with OANDA. Stephen's market views focus on the movement of G-10 and ASEAN Currencies. His views appear in Bloomberg, CNBC.Reuters, New York Times WSJ and the Economist. His media appearances include Bloomberg TV & Radio, BBC International, Sky TV, Channel News Asia, ASTRO AWANI and BFM Malaysia. Stephen has an extensive trading experience in Spot and Forward FX, Currency and Interest Rate Futures, Money Market Derivatives and Precious Metals. Before joining OANDA, he worked with organisations like Nat West, Chemical Bank, Garvin Guy Butler, and Sumitomo Mitsui Banking Corporation. Stephen was born in Glasgow, Scotland, and holds a Degree in Economics from the University of Western Ontario.