Japanese Yen: Focus shifts to BoJ path – Scotiabank

Scotiabank strategists Shaun Osborne and Eric Theoret note that the Japanese Yen (JPY) is slightly softer versus the US Dollar (USD), with USD/JPY trading between 158.00 support and resistance in the upper‑159s. Market attention is moving from past intervention toward fundamentals ahead of the September 18 BoJ meeting, where about 20 bps of tightening is priced, offering some scope for near‑term JPY strength.

Yen steady as BoJ meeting nears

"The JPY is soft, down a fractional 0.1% vs. the USD and a mid-performer among the G10 currencies as we head into Monday’s NA session."

"The market narrative appears to be shifting from the official intervention that dominated through much of the summer with participants now tightening their focus on fundamentals into the September 18 BoJ meeting."

"The meeting is currently priced for about 20bpts of tightening, offering some scope for additional near-term strength."

"Greater risk lies with the central bank’s tone as policymakers manage expectations for the rate path into year-end and into early 2027."

"Price action in USDJPY has been relatively muted, with support bound between 158.00 support and resistance in the upper 159s."