Be careful of the risk of a sudden yen appreciation
Regardless of how the Omicron variant turns out, unless a clear impact on the U.S. economy emerges, the Fed will steer toward inflation containment, accelerate tapering, and hasten rate hikes.
In other words, the U.S. 5-year Treasury yield, which has strong influence on the USD/JPY rate, is expected to be flat to slightly firmer, suggesting a firm dollar. However, there is a wildcard.
The wildcard is,
× ![]()
