USD/JPY is down 0.9% or a little over 130 pips on the day, to around 146.40 levels currently. It comes after a marked gap lower in the pair following BOJ governor Ueda's remarks on a "stealth exit" from the current ultra easy monetary policy. In the big picture though, it's not that big a blow for the upside potential in USD/JPY still:

USDJPY D1 11-09
USD/JPY daily chart

It's an ominous-looking candle but technically, buyers are still in with a shout so long as price action continues to keep above the 145.00 mark I would say.

In case you missed the developments from earlier:

This has helped 10-year JGB yields shoot up to 0.70% on the day, after having seen the previous threshold in and around 0.65%. In turn, bonds elsewhere are also selling off with 10-year Treasury yields up 4 bps to 4.296% currently.

However, the market mood in equities is calmer. The Nikkei may be down 1.1% but US futures are little changed and that might speak a bit to how broader markets are perceiving the headlines above.

The dollar is lower across the board in general as we do see USD/JPY slide, but it seems like dollar bulls are just squaring their positions with reason for profit-taking amid the latest moves in the last one to two weeks.

As for Ueda's remarks, I don't think I would be at fault to say that I still hold my reservations. It would be a tailwind for the yen if they do allow 10-year JGB yields to be more flexible and travel closer to the 1.00% mark but we'll see. Otherwise, what has really changed?

Not much, at least in my view. Ueda himself and policymakers have had plenty of opportunities to go on the record and clarify their intentions but they have let yen bulls down time and time again since March.

This talk of a "stealth exit" means nothing if not backed up by actions and at best, I still see them alluding to wage developments. And that could mean ending up to wait until the next spring wage negotiations in March 2024.

Ueda did mention that they cannot rule out gathering enough information on wage developments by year-end, but that would be a bold step. And so far, his time in charge has proved anything but.

I sure would like to stand corrected but given time, I'd see this as an opportunity to buy yen pairs on dips - the same as what we saw after the July policy tweak/adjustment.