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Senior Analyst at Danske Bank Kristoffer Lomholt notes the Japanese Yen remains vigilant on the upcoming BoJ meeting next week.

Key Quotes

“In FX markets, a recent USD/JPY decouple from 10Y rates spreads suggests investors have positioned for a possible policy twist from the BoJ at the 31 July meeting”.

“We do not expect the BoJ to adjust its policy next week, however, and if we are right, it should have a positive impact on the JPY and Japanese FI market”.