It comes after BOJ governor Ueda's remarks earlier in the day here. USD/JPY is now up 0.3% to near 147.40 but is still somewhat contained as sellers stay in control for now:
The good news for buyers at least is that they have at least stopped the rot from the last few days. There appears to be some consolidation as sellers struggled to break below 146.50-60 since overnight trading.
Ueda's remarks earlier were consistent with what the BOJ has been working towards in recent months. However, he fell short in hinting about anything on exiting negative rates or scrapping yield curve control policy. And that is enough to disappoint yen traders already as seen above.
And so, therein lies the risk for the Japanese currency in the week ahead. If the BOJ does not walk the walk after having talk the talk, we are staring at the likelihood of a much lower squeeze in the yen.
But first, we'll see how much expectations traders will put on the outcome of the spring wage negotiations. We should get headlines on that some time between 13 March to 15 March. As for trading today, USD/JPY will have to watch out for the US CPI data. That will bring back the dollar side of the equation into the picture.
