JPY weakness trend is supported - Nomura

Research Team at Nomura, suggests that historically, higher global yields have weakened JPY the most in G10 FX, and this relationship could be exacerbated by the BOJ’s yield curve control policy.

Key Quotes

“Under the BOJ’s policy initiatives, rate spread could widen smoothly, while risk sentiment is supported thanks to lower volatility. Global steepening and the BOJ’s effective yield curve control could support the JPY weakness trend, although the resilience of risk sentiment is key for the sustainability of JPY weakness.”