Summary
Yen selling has gained momentum since the launch of the Takaichi administration. The market continues to see a combination of rising share prices and a weaker yen as expectations for expansionary fiscal policy and monetary easing take hold. The BOJ and FOMC meetings lowered expectations for rate hikes in Japan and for rate cuts in the US, which has revived interest in yen carry trades. We expect the yen selling tone to continue now that the Takaichi administration has completed its initial diplomatic schedule and is getting fully down to business. The 155 level is within reach, though signs of verbal intervention aimed at curbing yen weakness have begun to appear, suggesting the pair may face increasing resistance on the upside.