Japanese Yen Steadies Against USD as Bank of Japan is in Focus.
USD/JPY made a 24-year high this week but lacked follow through
JPY directionality appears to have stalled ahead the Bank of Japan on Friday
The Japanese Yen faces a policy problem ahead as the Bank of Japan (BoJ) have committed to maintain their current stance on yield curve control (YCC) and monetary policy in general.
The BoJ is now in the crosshairs of scrutiny with their meeting due to take place this Friday.
Central banks can loosen or tighten policy to bring future demand foward to today (loosen) or push demand away from today (tighten).
The design of such changes is to manage inflation, both realized and expected.
The current global surge in inflation is mostly supply-driven but central bankers' current ultra-loose monetary policy is enabling consumers to pay higher prices than would otherwise be the case.
The latest data shows annualised GDP at -0.5% year-on-year and headline CPI is 2.4% year-on-year.
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