We are noting a rise in the probability of yen intervention from monetary authorities as the USD/JPY spot moves closer to previous JPY purchases levels
In this note, we're summarizing a variety of sources on what traders should look for ahead of potential FX intervention operations from Japanese monetary authorities
1) Verbal. We will first hear finance, currency, BoJ officials say that they desire FX to reflect fundamentals and that they are watching the markets with a "sense of urgency." The desk at ANZ noted that this process will repeat several times before physical FX purchases from authorities
2)Time. Bloomberg Economics FX research said on Bloomberg TV that authorities like to intervene heading into London market open, when liquidity is thin and the programme can have a larger impact on the market
3)Day. Monetary authorities are more likely to intervene on USD/JPY during Friday session, according to Bloomberg Economics on BTV. Remember, this is still Thursday night in N.A.
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