Yen And JGBs Sold On New BOJ Nominees While Japanese Stocks Rally To Record Highs

2026-02-25 07:20:00 ET

The dollar was initially sold during President Trump’s State of the Union Address. However, against most of the G10 currencies, it remains within the well-worn ranges, which may be reinforced by a busy option expiration schedule, which we discuss below. There are two notable exceptions. First is the Japanese yen, which sent to more than two-week lows following news of two dovish appointments to the BOJ board to replace members whose terms are ending. This reinforces the sense of Prime Minister Takaichi's monetary policy desires. Japanese stocks rallied, but JGBs sold off. Second, Australia’s January CPI was firmer than expected, and this pushed expectations a bit higher for another hike as soon as the May central bank meeting. The Australian dollar is the strongest of the G10 currencies today....

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