Since the Yen low (USD high) at 125.86 in June 2015, the Yen has climbed about 15%.
Since Jan 29, 2016, when BOJ (Bank of Japan) moved to Negative Interest Rate Policy (NIRP), the Yen has climbed nearly 12%!
Let's fully understand that instead of weakening in reaction to negative interest rates, the Yen has strengthened!
My reaction to this counter-intuitive situation is that:
1) market psychology has reversed from confidence in QE (very easy money) to concern that it has not, all will not work to produce inflation and demand, and
2) investors have been, and still are, unwinding massive, intermediate-term, short Yen positions that reflected their prior optimism in “Abenomics”.
We should, because this counter-intuitive picture is coming to a theater near you, as The Great QE Unwind extends into the US financial markets, possibly much sooner than later.