The upward trajectory of Dollar/Yen is driving cross-currency basis wider. Yen rate has been relatively stable thus far, which stands in stark contrast to GBP and other G10 bond markets. How the Bank of Japan’s yield control policy withstands stresses in Gilt and other global bond markets remains an open question.
In today’s episode, MUFG Chief Japan Strategist Takahiro Sekido reviews cross-border securities flows during the volatile price action that occurred during the months of August and September, as well as additional insights from the quarterly Tankan survey. He also shares his views on spot Dollar/Yen, Yen rate, and Yen basis.
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