USD/JPY is trading at its highest level in more than a week at 115.50, supported by rising US T-bond yields. Economists at OCBC Bank expect the pair to test the 116.00 level.

USD/JPY to re-establish its correlation with yield differentials

“Our bias remains positive on yield differential arguments for now, barring any excessive downside moves on the risk markets.” 

“Our bias is for the pair to edge higher. A move towards 116.00 for the USD/JPY should not be explicitly ruled out.”