Yentervention! Japan, BOJ Enter FX Market With “Bold Action”, Send USDJPY Tumbling

usdjpy intervention


With the yen plummeting earlier today, after the BOJ decided to keep its YCC and abandon the yen to its collapsing fate, we said that the BOJ better intervene soon or all hell would break loose:

Two hours later, the BOJ has done just that, and after warning earlier in the session of “stealth intervention”, it decided to finally put money where its endlessly big mouth is in an intervention that is anything but stealth:

  • GOVT, BOJ STEPS INTO MARKET TO BUY YEN FOR DOLLARS, CONDUCTS FIRST FX INTERVENTION SINCE JUNE 1998
  • JAPAN’S KANDA: HAVE INTERVENED IN FX MARKET

In kneejerk response, the Yen predictably soared, jumping as much as 1.1% as the USDJPY collapsed by a whopping 300 pips from 145.50 to 142.50!

It now appears that the new market level which the BOJ is comfortable with is around 143. However, now that the BOJ has fired its yentervention bazooka, with fundamentals screaming for a far weaker yen for years to come, especially with Kuroda stating that there will be no change in policy for at least two years…

  • *BOJ’S KURODA: NO NEED TO CHANGE GUIDANCE FOR 2 OR 3 YEARS

… as the BOJ has no choice but to prop up the YCC while ignoring the collapse in the yen, it is only a matter of time before this BOJ/MOF intervention fizzles, as have all previous attempts to contain the USDJPY through direct currency intervention…

boj%20interventions 0

… and the yen resumes its march toward 150, then 200 and so on, on its irreversible way to the scrapheap of MMT-destroyed currencies.





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Author: ntotb

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