The JPY sold off sharply on news that the BoJ was not loosening its accommodative policy but it has subsequently recovered a large part of these falls. Any further widening in the YCC band could be delayed until April, in the view of economists at Rabobank.

USD/JPY seen at 128 in a three-month view and 126 in six-months

“It is likely speculation of another adjustment to YCC will build again in March, although we would expect the April meeting to be a more likely source of change.”

“Our one-month USD/JPY 130 forecast crudely reflects our view that both today’s and March’s policy meetings could bring steady policy. That said, we forecast USD/JPY at 128 in a three-month view and 126 in six- months.”