
After the BoJ's subtle tightening bias last week and the shift in tone from Governor Ueda, there’s rising speculation that Japan is gradually moving away from ultra-loose monetary policy. Meanwhile, U.S. Treasury yields have shown signs of peaking amid softer U.S. economic surprises and growing anticipation of a Fed pivot in Q4.


The yen, deeply oversold and still under-owned by real money investors, could benefit from any deterioration in U.S. macro data or further dovish Fed commentary in the week ahead.

Additionally, geopolitical tensions in East Asia and month-end repatriation flows could further support JPY strength.

SHORT USDJPY

Jul 28 2025