Against the backdrop of Prime Minister Koichi's fiscal expansion policy, the USD/JPY rebounded to the late 154 yen area.

【2/18Market Overview

During Tokyo time, the USD/JPY fell to around1as Japan's January trade deficit was smaller than expected153.06yen, but then buybacks came in aided by gains in the Nikkei,153.70rising to the high 153s. In European hours, USD/JPY rose on the back of higher U.S. 10-year Treasury yields and strong buying10pushed to around153.84yen. After that, the range-bound movement continued for a while.NYtime, with Prime Minister Kishida's remarks suggesting a pro-growth fiscal stance—“the core of policy transformation is responsible and proactive fiscal spending,” and discussing “zero consumption tax on food and a refundable tax credit, pursued concurrently”—as well as the release of1January industrial production beating expectations, indicating a resilient U.S. economy, the USD/JPY breached the 154 level, triggering short-term stops, briefly rising to154yen and reaching as high as154.87yen.

【2/19Market View