Higher interest rates could increase unrealised losses | 29 tháng Tám 2023

29 tháng Tám 2023, USD/JPY

Higher interest rates could increase unrealised losses

USDJPY trading plan:

Japan's financial regulator will closely monitor how central bank policy impacts regional banks, as the world's third-largest economy approaches the normalisation of its monetary settings after years of massive easing. The Bank of Japan last month modified its yield curve control scheme and allowed interest rates to rise more flexibly, a measure officially targeted to sustain easing but seen by markets as a prelude to dismantling decades of stimulus. Higher interest rates could increase unrealised losses on domestic bonds held by Japanese banks, although such losses could be offset by stronger net interest margins from their lending business. Large banks have shortened the duration of their bond portfolios in anticipation of higher yields, but analysts say some smaller, regional banks do not have such flexibility.

Investment idea: range 146.00 -146.90.

David Johnson
Analyst of «FreshForex» company
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