JPY: Speculative market caught on the wrong side of the trade - BNZ

Jason Wong, Currency Strategist at BNZ, notes that the big mover over the day has been the Yen, following the decisive victory by the ruling conservative party in Japan’s upper house elections.

Key Quotes

“The Nikkei 225 index shot up by 4%, on hopes that further economic stimulus would come sooner than expected. PM Abe later announced that he would order preparation of an economic stimulus package today.

Reports of BoJ Governor Kuroda meeting with former Fed Chair Bernanke or “Helicopter Ben” also got the attention of the market. USD/JPY shot up and has continued to plough on higher. Positioning data had shown a strong build-up of long Yen positions, so the speculative market has been caught on the wrong side of the trade.”