USD/JPY – Yen spikes after Ueda comments but is it sustainable?

  • Ueda hints that BoJ could raise rates
  • How seriously should we take the comments amid intervention speculation?
  • Divergences suggest traders becoming nervous

A relatively quiet start to the week from an economic data perspective but we’re still seeing some decent moves in the markets this morning, particularly in the Japanese yen.

The yen has jumped this morning on the back of comments from Bank of Japan Governor, Kazuo Ueda, who hinted that interest rates may not be negative for much longer.

Ueda reportedly claimed that if they become confident that prices and wages will keep rising sustainably, which could be as early as year-end, then an end to negative interest rates could be one option on the table. The focus for so long has been on the central bank’s yield curve control policy but perhaps these comments suggest abandoning that will not be the first major move.

Of course, at a time of so much speculation around currency intervention and a rapidly weakening yen, you have to wonder what the real motivation behind these comments is and how seriously to take them. Only time will tell but for now, they’ve managed to give the yen a boost.

Are we seeing signs of nerves?

The dollar has run into resistance repeatedly over the last week around 148 against the yen which suggests there’s some apprehension around these levels.


Source – OANDA on Trading View

We are very much in the territory where interventions have occurred in the past which may explain those nerves and Ueda’s comments gave traders further reason to fear action that could significantly boost the yen.

You can see from the MACD in particular that recent rallies have not been matched by increasing momentum and that divergence may support the idea of nerves creeping in.

A move below 145 would be interesting, with the area around here having been notable support recently and resistance back in late June and early July. It’s also around where the Ministry of Finance intervened last September.

Traders have not been fully deterred by verbal intervention in the past though and if we do see another move to the upside, it will be interesting to see whether it’s matched by momentum or a deepening divergence.

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at Visit to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.

Craig Erlam

Craig Erlam

Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam