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Yen stays a G10 laggard despite higher Japan yields

Societe Generale expects 10-year JGB yields could rise toward 3.5% after additional 75bp Bank of Japan hikes, yet FX markets remain unimpressed, leaving USD/JPY above its 200-day average near 159.

Reported · Written up by our desk · Major Pairs

Societe Generale strategists said the Japanese yen is still the main laggard among G10 currencies, even as higher Japanese yields and continued Bank of Japan tightening have supported interest rate expectations.

They pointed to expectations that the 10-year JGB could climb toward 3.5% as the BoJ delivers additional 75 basis points of hikes, but they noted FX markets have shown limited enthusiasm for the yen.

In current trading, USD/JPY is above its 200-day moving average and is near the 159 area, underscoring the yen weakness despite the yield outlook.

FXStreet also flagged broader market positioning around USD demand and the week ahead, noting that Wednesday's US CPI data is a key event risk.

Latest closeUSD/JPY 159.27 ▲0.5%

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