The USD/JPY pair is set to hit the 150 level, according to economists at Bank of America who maintain a bullish bias through the first quarter of next year.

USD/JPY to correct on the Fed’s rate cuts later into 1H24

“USD/JPY rally may slow down as the Japanese government attempts to cap USD/JPY’s upside but the market would buy USD/JPY’s dip. Carry trades are likely to weigh over JPY if the market comes to realization that the Fed is expected to hold for some time.” 

“USD/JPY is likely to test 150 by 1Q23 before peaking out on a US recession concern first in the middle of 2023 and correcting on the Fed’s rate cuts later into 1H24.”