The Bank of Japan announcement:


The focus of the session was the response of Asian markets to the Federal Open Market Committee (FOMC) (expected) rate hike and higher ‘dot plot’. See the US-time session Wrap, linked in the points above, for a recap ICYMI.

The summary of market moves is that almost everything dropped, except the USD:

  • US equity indexes extended their losses on Globex trade
  • Regional equities here fell
  • Gold fell
  • FX against the dollar fell pretty much across the board. GBP/USD, for example, hit a 37 year low)the Bank of England policy decision is coming up in a few hours, previews linked above also).

The People’s Bank of China set its USD/CNY reference rate at its highest USD/CNY since early August 2020 (i.e. weakest mid-rate for the onshore yuan).

As we headed into the Bank of Japan policy announcement (if you are new to BOJ policy statements there is no set time for the announcement) USD/JPY traded higher and sat around 144.50, just shy of its recent top.

The BOJ announced no change in policy, as was widely expected. USD/JPY spiked above 145, almost to 145.50 but dropped back under 145.00 just as quickly. While there was no sign of Bank of Japan intervention in the market there were signs of large Pension funds and or exporters hitting USD/JPY quite hard, if so this is likely at the request of authorities. Large Japanese firms (Japan Inc.) tend to have very close relationships with the Japanese government.

As I post this update USD/JPY is threatening 145 again:

usdyen wrap 22 September 2022