The threat of a shift in Bank of Japan policy next month isn't giving pause to the USD/JPY bulls as the pair pushes to a fresh seven-monthi high.
I wrote yesterday about the BOJ's summary of opinions and the unease that's creeping into the central bank regarding yield curve control. For now though, the BOJ decision is a month away and quarter-end flows are dominating, with a strong US dollar bid hitting today on strong domestic data. The Consumer Confidence data from the Conference Board was particularly hot at 109.7 compared to 102.3 previously.
The recessionary mindset is being pulled out of the US economy and that could spell higher rates. The market is still skeptical that will spill over into Japanese inflation but I'm not so sure that Japan can remain immune to rising global prices (especially with a falling currency).
