Speculators Turn Net Long Yen on BOJ Bets

Speculators flipped to a net long yen position for the first time since February, CFTC data showed for the week to Sept. 8: 10,796 net long contracts after a prior-week net short of 92,227. The yen strengthened, with dollar-yen at 152.89 on Sept. 8, its best since mid-February, after a July low of 163.99 and intervention by Tokyo and Washington. A years-long slide had accelerated after Sanae Takaichi, seen as a fiscal dove, was elected prime minister in October 2025. Markets price a quarter-point BOJ rise to 1.25% on Sept. 18; a Reuters survey put economist odds at 97%. The same survey found 62% of analysts expect 1.75% by the second quarter of 2027 and 40% an eventual peak of 2% or higher. Board member Kazuyuki Masu has said the BOJ may be forced to raise rates rapidly if inflation accelerates. Governor Kazuo Ueda said the board will carefully scrutinize how the cumulative impact of the moves could affect the economy. Coverage notes the swing may largely reflect short covering by carry-trade holders rather than fresh bullish conviction, and recalls the summer 2024 carry-trade unwind that rattled global markets. Focus now turns to whether Sept. 18 guidance signals a faster path beyond the hike already expected.