💹USD/JPY Could Break Below 153.0 Soon: Cable FX Macro

• Speculation has built around an earlier/next BoJ hike, potentially as soon as April 2026. Comments from former BoJ board member Seiji Adachi highlighting April as likely timing.

• This narrowed the US-Japan yield spread appeal and supported yen demand, pressuring USD/JPY lower (e.g., sharp drop after Bloomberg report on Feb 17).

• Another factor supporting the strength of the yen has been the recent unwinding of carry positions, which has had a notable impact on currency dynamics. Carry trades typically involve borrowing in a low-yielding currency, such as the yen, and investing in higher-yielding assets denominated in other currencies. Traders engage in this strategy to capitalize on the interest rate differential, expecting to profit from the spread. However, shifts in market sentiment or economic indicators can lead to a rapid reversal of these positions, which is what we are currently witnessing.

• In short, the yen has outperformed due to domestic Japan factors (BoJ timing bets + fiscal caution post-Takaichi win) more than broad USD weakness. This has made USD/JPY fragile, with carry unwind risks lingering. I will be watching today's FOMC Minutes for further colour on the USD side of the equation, plus any fresh BoJ/Takaichi comments or US data reactions. If yen flows persist, sub-153 tests remain possible short-term.