TS Lombard economist Rory Green said Fed Chair Kevin Warsh’s post-decision remarks, read by markets as dovish, may have created an opening for Japan to intervene to support the yen. Markets suspect today’s roughly 2.5% intraday fall in USD/JPY may reflect Japanese official intervention. Green said the Fed’s dovish stance could give Japan’s finance ministry a favorable opportunity to act and noted past interventions were often accompanied by Bank of Japan rate hikes. He added that a BOJ hike tomo

TS Lombard economist Rory Green said Fed Chair Kevin Warsh’s post-decision remarks, read by markets as dovish, may have created an opening for Japan to intervene to support the yen. Markets suspect today’s roughly 2.5% intraday fall in USD/JPY may reflect Japanese official intervention. Green said the Fed’s dovish stance could give Japan’s finance ministry a favorable opportunity to act and noted past interventions were often accompanied by Bank of Japan rate hikes. He added that a BOJ hike tomorrow would still surprise markets, but the meeting is no longer a foregone conclusion.