USD/JPY 2026 Forecast: “14-Point Forex Civil War” Erupts as Banks Clash
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Banks split on 2026 USD/JPY year-end targets (150–164) as markets price BOJ tightening to 1.00–1.25% and Fed cuts to 3.50–3.75%, creating wide FX policy dispersion ahead of 2026; this divergence magnifies cross‑market liquidity risk. A potential violent unwind of the ~7.5T yen carry trade could trigger sharp risk‑off moves and liquidity shocks, posing downside pressure on crypto markets and stressing DeFi, CEX/DEX liquidity and token prices.
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- USD/JPY 2026 major bank year-end 2026 forecasts range from 150 to 164, fueling a “14-point Forex Civil War.”
- Banks assume the BOJ raises rates to 1.00-1.25% and the Fed cuts to 3.50-3.75%, in line with OIS swap pricing.
- A violent unwind of the 7.5T yen carry trade could trigger sharp risk-off moves across global liquidity and crypto markets.
The world’s most-traded Asian currency pair, USD/JPY, sits at the center of a major policy clash heading into 2026. Leading banks such as J.P. Morgan and Scotiabank disagreed sharply on their direction, with forecasts spanning from 150 to 164. Diverging monetary policies from the Bank of Japan (BOJ) and the Federal Reserve are driving this split and reshaping global liquidity flows.
Banks Split on 2026 USD/JPY Year-End Targets
According to sources, major banks are split on 2026 USD/JPY year-end targets, with fore…
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