USD/JPY could plunge under 150 if the BOJ sends any hawkish messages

The yen could strengthen beyond 150 against the dollar as the Bank of Japan diverges from the global trend of rate cuts, according to SMBC Nikko Securities strategist Makoto Noji.

“With central banks around the world easing policy, the BOJ stands out as one of the few raising interest rates. This policy divergence could accelerate yen buying,”

• added that the yen is particularly sensitive to any hawkish signals from the BOJ, making further appreciation likely if the central bank reinforces its tightening stance.

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USD/JPY update. It dipped under 151.00 very briefly after the strong data earlier and has since leapt 60 or so points:

Earlier:

• Japan data: December Household Spending YoY +2.7% (vs. expected: 0.2%, previous: -0.4%)

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