Snippet on the Bank of Japan meeting and yen outlook.

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Credit Suisse maintains a bullish bias on USD/JPY over the coming weeks.

• “We said we were not inclined to fade USDJPY strength, even with the pair trading near our 150 target. One week later, and with a fairly aggressive FX intervention and a sizeable rally in US Treasuries in the rear -view mirror, JPY is trading less than 1% stronger vs the levels that prevailed at the time. With no visibility on the outcome of this week’s BOJ decision and no strong indications that a change is imminent beyond a shift in market expectations, we still do not see a strong urge to adopt a different approach for now,” CS notes.
• “In the event that the BOJ were indeed to signal a change in forward guidance, a dip further towards the lower end of our Q4 140 – 150 target range is possible, but far from a given, given the backdrop of already fairly aggressive market expectations. We are also sceptical of the view that a minor change in forward guidance would trigger a deeper or longer -lasting correction, given our sanguine view on Fed tightening and the still limited prospect for a major turn in actual BOJ policy before the end of Governor Kuroda’s term, in April 2023,” CS adds.