USD/JPY is up for the third straight day and trading at the highest since May 18. Economists at BBH believe that the pair could climb as high as the January 2002 high near 135.15.

Bank of Japan remains ultra-dovish

“Clean break above 129.45 sets up a test of the May 9 high near 131.35. However, we continue to look for our long-standing target of the January 2002 high near 135.15.”

“We continue to believe Governor Kuroda will maintain current loose policy through the end of his term in spring 2023, leaving it to Prime Minister Kishida to appoint a more hawkish successor to start the tightening cycle.”