If the overall rate were to fall only slowly, with the core rate remaining stubbornly high, expectations are likely to rise that the BoJ might move away from its ultra-expansionary monetary policy in some shape next week, which would support the Yen. 

However, the BoJ would have to be clearer than last time in December 2022 when it ‘only’ widened the yield range and caused a lot of drama short-term, but it then became clear in the end that it hadn’t changed anything about its monetary policy. The new central bank governor Kazuo Ueda did not initiate the hoped for reversal in the spring either. But perhaps the time has now come.