ICYMI – Citi base case is for no USD/JPY intervention before 160

Spotted a view from Citi on the news wires.

• Citi Research anticipates that the Japanese government might intervene to support the yen if the USD/JPY exchange rate reaches the 160.00–165.00 range.

Citi’s expectations were from before remarks from Bank of Japan (BoJ) Governor Kazuo Ueda on Monday,.

More:

• Ministry of Finance (MoF) may be preparing for intervention, but Japan’s financial authorities are likely to prioritize a potential rate hike by the BoJ if circumstances allow.
• Citi believes intervention is unlikely unless USD/JPY surpasses 160.00.
• If this threshold is crossed, the probability of the BoJ raising rates to 0.5% at its Dec. 18-19 meeting increases.
• In this case, senior BoJ officials might begin issuing more hawkish signals to prepare the market for such a move.

This article was written by Eamonn Sheridan at www.forexlive.com.