USD/JPY rises to a session high of 107.59
The yen has eased on the BOJ announcement calling for a meeting this Friday to discuss on new measures to provide funds to the financial system.
Despite possible concerns about liquidity strains faced by banks, the fact that Kuroda had preempted this beforehand and that the BOJ is pointing specifically to that does help to ease some worries to that end.
As such, I wouldn't argue that this is going to be a something major by the BOJ or that something in the system has gone horribly wrong.
We have already seen other central banks step in with similar measures so the BOJ is taking a page of the playbook. However, not waiting until June could either mean that they are opting to be overly cautious or that they do have warranted worries in the market.
I reckon investors will give them the benefit of the doubt, for now at least.
As for the yen reaction, it appears rather knee-jerky. Sure, this adds to the list of policy easing measures by the central bank but it's not to say that this is an unprecedented step in this environment when we have already seen other central banks do the same.
For USD/JPY, the topside move is running into some trendline resistance with the region around 107.40-50 also still proving to be a bit sticky in limiting gains.
Buyers are keeping near-term control and the 200-hour MA (blue line) remains the key line in the sand in that regard. That said, the turnaround in the risk mood to being more cautious now isn't quite helping during the session.
As such, it may appear that USD/JPY needs a bigger push in order to try and get above the near-term levels highlighted before pushing to the high last week @ 107.77.
