BOJ Faces Market Expectations Ahead of Policy Decision

The recent yen rally faces a key test as the Bank of Japan prepares its policy decision. Analysts warn markets may be pricing in too much tightening, risking a sharp currency reversal.

作者：IUX242026年9月15日上午6:03 [UTC]

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FILE PHOTO: FILE PHOTO: Holograms, which show different images and colours depending on the angle at which they are viewed, are seen on the new Japanese 1,000 yen banknote as the new note is displayed at a currency museum of the Bank of Japan, on the day the new notes of 10,000 yen, 5,000 yen and 1,000 yen went into circulation, in Tokyo, Japan July 3, 2024. REUTERS/Issei Kato/Pool/File Photo/File

The USD/JPY faces a pivotal test during Friday's policy decision as Japan's central bank risks disappointing investors who priced in aggressive rate hikes. The currency recently touched a seven-month high at 152.89 per dollar following aggressive policy bets. Analysts warn that market expectations have outpaced economic reality, threatening a sharp reversal toward 157 per dollar.