Yen pressured on yields, but watch the squeeze - Scotiabank

In respect of the Yen, analysts at Scotiabank explained that relative to central bank policy appears to be dominating once again, with an impressive widening in the 2Y U.S.-Japan spread toward 155bpts at levels last seen in 2008. 

Key Quotes:

"The move in fundamentals has offset the recent support delivered by sentiment that had pushed JPY toward the February 7 high at the upper end of its multi-month range. 

JPY’s risk profile leaves it vulnerable to knee-jerk, haven-driven gains in periods of risk aversion."

"CFTC positioning in JPY remains bearish, putting JPY shorts at risk of a squeeze."