Narrowing interest rate differentials between the US and Japan are starting to reassert their influence on USD/JPY, driving the pair to fresh five-week lows on Tuesday. However, early optimism over trade policy was dashed by confirmation the Trump Administration is likely to impose 25% tariffs on imports from Canada and Mexico starting in February. With a Bank of Japan (BoJ) rate hike this week nearly fully priced, could this latest slide in USD/JPY present a buy-the-dip opportunity? The strengthening relationship between interest rate differentials and USD/JPY is evident in the left-hand pane of the chart below, ... (full story)