BoJ Uchida calms markets, weakening yen. USDJPY gains 1.3%

Bank of Japan deputy governor, Uchida spoke publicly in Hakonde:

• BoJ will not raise rates unless the market is stable
• Market is buoyed by US data, US economy should experience soft landing, however
• Path for interest rates may depend on market situation
• Policy will remain defensive, even with several hikes
• Real interest rates still strongly negative
• Financial conditions remain strongly accommodative
• Personally thinks markets will calm down and think carefully about further moves due to the situation
• Economically than has not changed, only market conditions show that one must be prudent
• Consumer spending remains strong, but one should be careful about it

The market expects less than a 10bp hike this year. On the other hand, expectations for a hike have risen marginally since yesterday. A nearly full hike is priced in by January. Source: Bloomberg Finance LP, XTB

USDJPY is clearly weakening after Uchida's statement. The JPY is already losing 1.7% against the dollar. On the other hand, the yen's weakening has diminished as of 06:45 a.m. USDJPY is reacting to support at 146.5.