MUFG's 4 reasons every BOJ meeting is live for a surprise, & forecast USD/JPY drop to 130

<p>Analysts at Mitsubishi UFJ Financial Group Inc.'s (MUFG) are not expecting the yen weakness we've been seeing to carry on:</p><ul><li>Yen … looks over-extended to the downside </li></ul><p>Their forecasts for USD/JPY out for the next 12 months:</p><ul><li>Q3 2023 136.00 </li><li>Q4 2023 134.00 </li><li>Q1 2024 132.00 </li><li>Q2 2024 130.00 </li></ul><p>MUFG outline 4 reasons for the BOJ to pivot, saying </p><ol><li>Japan's equity market outperformance</li><li>positive inflation in land and property prices</li><li> high and sustained household inflation expectations</li><li>underlying inflation at a level not seen since 1981</li></ol><p>And this leaves:</p><ul><li>every BoJ meeting as live for a surprise policy change</li></ul><p>MUFG conclude on the yen outlook:</p><ul><li>we see a BoJ shift in YCC and a Fed pause by September helping fuel a sustained turnaround</li></ul><p>—</p><p>BOJ dates ahead for the rest of this year:</p>

This article was written by Eamonn Sheridan at www.forexlive.com.