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Analysts at Nomura suggest that the recent recovery in USD/JPY will be a relief for the BOJ, but they do not think the current level will be strong enough to accelerate core CPI inflation meaningfully.

Key Quotes

“It will need to overshoot to 120 or above in order for the BOJ to change its policy stance. At this level of USD/JPY, the BOJ is unlikely to change its policy stance in order to stop it appreciating further. It will take external headwinds, such as 1) broader risk-off moves and 2) a more dovish Fed, to stop the USD/JPY appreciation trend.”