The probability of yen weakness is higher than its strength.
The first decision of the new Bank of Japan Governor Kazuo Ueda was carefully followed by traders. It will be no different from the recent decisions of the previous BOJ chief Haruhiko. The Bank of Japan is going to leave the interest rate at 0.1% and the YCC yield curve control policy unchanged, which means buying more bonds and printing more yen, resulting in more downward pressure on the Japanese yen.
Speaking at the Japanese parliament on Monday, Ueda announced his intention and said that the previous pressure on the currency was due to the fact that the recent increase in inflation was only the result of a weaker currency and something seems stable. He ignored the increase in Japanese wages.
What matters to the markets is what the Governor of the Bank of Japan will do in a few months. Will the yield curve control policy be abandoned in July as some think?

Any hint he has of changing policies will increase the strength of the yen. But we do not expect any surprising events at this stage. They probably insist on their Davis messages.
This will push the yen lower. He is likely to be asked about the Bank of Japan’s investigations into yield curve control but declined to provide details. Investors will continue to be discouraged in July as the next possible exit point. As a result, lower points are expected for the Japanese yen.

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