Forex Flash: USD/JPY stable post BoJ under-delivery – Societe Generale

FXstreet.com (Barcelona) - Sebastien Galy, Senior FX Strategist at Societe Generale notes that gamma is fading as the market settles down post BoJ meeting.

He feels that the excitement is dying down as the market now searches for new themes to worry about. Overnight, the BoJ delivered what was expected, namely fed style QE, but much less to the extent that had been hoped for.

The extent of the bond buying did not impress, nor did keeping purchases to the front end of the JGB curve or waiting for the end of the current program for unlimited QE to start. The upcoming BoJ administration has its work cut out for it. While USDJPY corrected initially below 88.50, it has already stabilised and should continue to after a wave of profit taking in NY.