Bank of Japan is expected to raise rates as speculators turn net long the yen

Futures positioning flipped bullish on the yen for the first time since February, days before a Bank of Japan meeting markets expect to deliver another increase.

Assembled by Claude from 9 sources at 9 outlets · Sunday, September 13, 2026, Morning edition, 10:13 AM EDT · no human byline

What happened

Speculators have turned net long on the yen for the first time since February, Reuters reported reuters.comforexfactory.comca.finance.yahoo.com. The yen has surged this month on expectations of an accelerated schedule of rate rises by the Bank of Japan and on a potential repatriation of assets businesstimes.com.sgreuters.com.

The central bank is widely expected to lift its policy rate from 1.0 percent to 1.25 percent at its monetary policy meeting on 17 and 18 September, a level one report described as the highest in 31 years finance.biggo.com. Other coverage set the same expectation, with the bank seen raising to 1.25 percent and possibly signalling more thestandard.com.hk, and with the increase widely predicted at the end of the week after a raft of supportive data straitstimes.com. Nikkei framed the move as an attempt to contain inflationary pressure asia.nikkei.com. By contrast, markets expect the Bank of England to leave its policy rate unchanged businesstech.co.za.

Why it matters to investors

The yen is the funding currency that sits underneath a great deal of global leverage, so a tightening Japan changes the cost of that funding rather than only the Japanese rates curve. Positioning has already moved: the flip to net long is the first since February, which means the trade is no longer a contrarian one reuters.comforexfactory.com.

The repatriation channel is the second and larger one. Reporting ties the yen's rise not just to policy expectations but to the possibility that Japanese investors bring assets home businesstimes.com.sgreuters.com. That is a flow question rather than a rate question, and it points at overseas bond markets that have relied on Japanese buyers. A rate at the level markets expect would be the highest in 31 years, which gives domestic holders a yield they have not had for a generation finance.biggo.com.

What to watch

The first thing is whether the bank signals a further path or stops at this increase, since coverage suggests it may indicate more to come thestandard.com.hk. An accelerated schedule is what current yen pricing assumes businesstimes.com.sg.

The second is the divergence across the major central banks in the same week. Japan is expected to tighten while the Bank of England is expected to hold businesstech.co.za, and the yen's direction from here depends on that gap as much as on the Tokyo decision itself. The third is positioning risk: a crowded long yen position going into a meeting that delivers exactly what is priced can unwind quickly reuters.comforexfactory.comca.finance.yahoo.com.

Sources

1. finance.biggo.com: Bank of Japan Poised to Raise Rates to 1.25%, First Time in 31 Years - BigGo Finance (2026-09-13)
2. forexfactory.com: Speculators turn net long on yen for first time since February | Forex Factory (2026-09-13)
3. thestandard.com.hk: 'This is the test': All eyes on US Fed to tackle high inflation - The Standard (HK) (2026-09-13)
4. ca.finance.yahoo.com: Speculators turn bullish on yen for first time since February - Yahoo! Finance Canada (2026-09-13)
5. businesstimes.com.sg: Speculators turn bullish on yen for first time since February on BOJ rate-hike bets (2026-09-13)
6. asia.nikkei.com: BOJ meeting, Semicon India, Hong Kong's first five-year plan - Nikkei Asia (2026-09-13)
7. straitstimes.com: All eyes on Warsh as rate-hike fever spreads across G-7 central banks | The Straits Times (2026-09-13)
8. businesstech.co.za: Billionaire's son in line to inherit R262 billion empire, and new retail store launches in South Africa (2026-09-13)
9. reuters.com: Speculators turn net long on yen for first time since February - Reuters (2026-09-13)