Yesterday, triggered by the weaker-than-expected results of the Consumer Price Index (CPI) that was announced at GMT 12:30, the USDJPY went into a decline so sharp that it could be termed a crash. It went from 161.52 at the time of the announcement to a low of 157.42 in around thirty minutes.

One explanation being offered for this plunge in the price is that the Bank of Japan conducted currency intervention directly after the CPI announcement, but it is not clear whether this is accurate or not.

Today (Tokyo time) the USDJPY has been fluctuating wildly up and down between the 157-yen range, some time after GMT 23:00, and the 159-yen range. Volatility has increased following the plunge in the price that took place yesterday afternoon, so traders should be wary of further unexpected price movements going forward.

Looking at the 1-hour chart of the USDJPY (as of GMT 05:20 on July 12), the expansion in the Bollinger Bands shows the dramatic increase in volatility.

(20-period Bollinger Band, showing ±1 and ±2 standard deviations)

Today's main economic indicators are as follows.

• GMT 12:30 U.S. June Producer Price Index (PPI, MoM)
• GMT 12:30 U.S. June Producer Price Index (PPI, YoY)
• GMT 12:30 U.S. June Producer Price Index (core PPI excluding food and energy, MoM)
• GMT 12:30 U.S. June Producer Price Index (core PPI excluding food and energy, YoY)
• GMT 14:00 U.S. July Michigan Consumer Sentiment, preliminary