A curious item in the Nikkei, opening with:
- The yen has picked up strength to a level not seen in roughly four months, seemingly putting the Bank of Japan's 2% inflation target in jeopardy.
Ummm ... on that ... the BOJ has not been in jeopardy of even getting close to that target ....
It goes on:
- Ever since Donald Trump's victory in the U.S. presidential election in November, a weakening yen has propped up export-heavy Japanese firms and corporate earnings, giving the inflation goal a new lease on life. But now that dynamic is heading in the other direction.
Ummm ... well, USD/JPY turned lower nearly 3 months ago ... so, yeah, but this point being made a bit late.
Anyway ...
The piece goes on to make the point that the yen had a 'buffer' ... US/yen was around 101 on US election day (give or take) and that has been, and is being, eroded
- In the U.S., Trump's push to repeal and replace the Affordable Care Act ... suffered a major setback... That defeat now clouds Trump's other signature agendas, such as tax cuts and massive infrastructure spending, sending long-term Treasury yields lower and shrinking the U.S.-Japan rate spread
Which is weighing on the USD/JPY.
There is more at the article ... despite being a bit muddled it does gove some good background on usd/yen developments, if you need: Japan's central bank losing headroom on the yen
