USD/JPY flows: JPY Remains Volatile Before BoJ

U.S. Treasury Yields has rebounded in the Asia session across the curve, so as JGBs. All eyes will be on BoJ meeting next week where we do not expect a change in policy but forward guidance instead. A surprise move will put a strong bid behind the JPY for it signals the BoJ is much more hawkish than they present, unless it is well supported by jumping wage that is unlikely to show in Q4. 

With BoJ exiting ultra-loose policy soon and the Fed tilting dovish, major rationale to stay long USD/JPY seems to be perishing and the correction may continue. USD/JPY is trading 0.13% lower at 141.64.