📝 Recommend Selling USD/JPY Topside, Buying Yen Above 140.0: UBS Strategy

USD-JPY could see some additional volatility in case speculation about a surprise change in policy swells, after the BoJ caught investors off guard in December.

Since mid-February, Japanese government bond (JGB) 10-year yields have frequently risen above the 0.5% cap, signaling an imbalance in supply-demand dynamics.

We see the BoJ ultimately having to abandon YCC sooner rather than later, and we recommend clients to neutralize yen-loan exposure.

Recommend selling USD/JPY topside or buying yen above 140.0

- UBS Strategy