• The yen has been the best-performing G10 currency at the start of this week.
• USD/JPY fell to an intra-day low of 155.31 overnight, moving further below the 157.89 high set on November 20.
• The yen’s rebound was reinforced by hawkish comments from Governor Ueda, signaling a higher likelihood of BoJ rate hikes this month.
• Japanese rate markets are now pricing in 21bps of hikes for the December 19 policy meeting, up from 15bps last week.
• The 2-year JGB yield rose above 1.00% for the first time since 2008.
• Governor Ueda stated the BoJ will weigh the pros and cons of rate hikes at the upcoming meeting.
