USD/JPY daily chart
The pair is up almost 190 pips today now, with a big jump from around 133.80 with the BoJ policy decision entering trading at 135.80 levels for now. This is the newly appointed Governor of the Bank of Japan, Kazuo Ueda’s first responsible meeting and his policy press conference is one of the meetings that disaster at least.
He started with Kuroda’s inside guidance by saying that the central bank would not hesitate to ease monetary policy further and that was enough to push the yen further lower on the day. But then, he went back and forth trying to articulate what exactly this policy review they had announced — which would have taken over a year to complete — was.
He gave the entire playbook on policy review but let’s be real here, who in the world reads this stuff?
In his words, he’s trying to say that the review is something that isn’t meant to take into account near-term policy changes and presumably looks at more “structural” issues. Whatever the case, the markets are not listening.
The point being made now is that there don’t seem to be any immediate political changes in the works. And Ueda’s lack of subtlety in emphasizing that the policy review period is not relevant does not help the JPY.
A break above 135.00 now is crucial for USD/JPY as it opens the way towards the 200-day moving average (blue line), which we are seeing at 136.96 currently. March 8th high of 137.91 will be the next upside target after that before we look at 140.00 next for the pair.