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  • BOJ's Governor Ueda: We are to a mull policy response if fx makes a big impact on outlook

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I am not seeing any impact (yet).
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BOJ: "We are thinking about possibly maybe acting like we might tighten. FX markets should possibly maybe think about cooperating with our preferences on the exchange rate."

Markets: Hmm. Let's just test you, then, BOJ. SINCE YOU HAVE ALWAYS BEEN SO STRONG AND RESOLUTE IN THE PAST.
I took a USDJPY short at 150.5 just in case they are not bluffing
waiting for boj intervention.
Quoting smallcapsule
waiting for boj intervention.
I agree.. I expect some comments soon.
If BOJ is going to take on the FX markets they need to treat it like the close-quarters knife fight that it is. A knife blade is best felt and not seen in such a situation. Announcing beforehand what you might theoretically do only stokes the FX market's predatory instincts - instincts that have become reinforced by BOJ's past history trying and failing to fight the exchange rate. They need to inflict major damage on JPY bears without warning at this point to scare the FX market.
Kanda said "prepared to take action on forex at any time, 24 hours a day, similar to a natural disaster" ... Just Wait..
Their FX reserves available to directly intervene in FX markets are no match for the markets. Not even close. Any FX intervention effects will be minor both in price and in time. The markets will steamroll them within 24-48 hours. They will only make a lasting dent in the exchange rate with policy changes. They would have to back-pedal on their just-announced bond purchase continuance, something that would make them look like they are panicking and like they are directly manipulating the exchange rate via policy.

Meantime, expect the FX markets to keep circling the BOJ like a pack of hungry lions. The lions may eventually get a hard kick in the jaw, but that remains to be seen, and from what level.
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