The USD\/JPY currency pair dipped below 155.0 on Monday due to an increase in Japanese 10-year bond yields. This movement followed hawkish remarks from BoJ Governor Ueda. The pair later rebounded as markets processed these developments.<\/p>\n
Japanese bond yields surged by approximately 6 basis points before easing by nearly 3 basis points. Markets are now considering a possible 20 basis point hike in December. The USD\/JPY briefly traded below 155.0, with suggestions that a further decline this week could occur unless BoJ officials soften their hawkish stance.<\/p>\n
The recent dip below 155.00 in USD\/JPY is a significant signal for us. This move was directly fueled by hawkish remarks from the Bank of Japan, which caused a spike in 10-year government bond yields. We see a strong case for further yen strength unless the BoJ unexpectedly softens its tone in the coming days.<\/p>\n
The Bank of Japan’s stance is reinforced by recent inflation figures, which we are watching closely. Japan\u2019s national core CPI for October 2025 registered at 2.9%, holding above the central bank’s 2% target for the 19th straight month. This sustained pressure, unlike the more transitory inflation seen in years past, makes further policy tightening seem almost inevitable.<\/p>\n
On the other side of the pair, recent US economic data supports a weaker dollar outlook. The latest Non-Farm Payrolls report for November showed a moderation in the labor market, adding 155,000 jobs against forecasts of 180,000. This clear divergence in central bank outlooks between a hawkish BoJ and a potentially pausing Fed is setting up the pair for a sustained move lower.<\/p>\n
In the coming weeks, we believe positioning for a continued slide in USD\/JPY is the primary trade. This suggests buying JPY calls or USD puts, especially with one-month implied volatility now pushing 11.5%, reflecting rising market expectations of a larger move. The market is currently pricing in a 20 basis point hike for the December meeting, so options strategies should be structured around that key event.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" USD\/JPY dipped below 155.0 after BoJ’s hawkish stance; markets eye potential December rate hike.<\/p>\n","protected":false},"author":62,"featured_media":17052,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-35786","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/35786","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/users\/62"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/comments?post=35786"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/35786\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media\/17052"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media?parent=35786"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/categories?post=35786"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/tags?post=35786"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}