Yen (JPY USD) Swings After BOJ Adjusts Yield Curve Control (YCC)

Jul 29, 2023

The Japanese currency fluctuated broadly around the 140 per dollar level after the decision.

The yen’s wild ride in the aftermath of a surprise tweak to Japan’s yield-curve control program may be only the beginning, with a divergence of views on where the currency goes from here.

After four straight days of strengthening versus the dollar, the yen whipsawed when Bank of Japan Governor Kazuo Ueda wrong-footed traders around midday Friday in Tokyo with a policy statement that markets are still trying to digest. The currency weakened around 1%, only to strengthen by the same amount, and then start depreciating again — all within an hour. The choppiness continued throughout his press conference, even as the magnitude of the moves narrowed.