The Dollar Yen (USDJPY) continues to mark time ahead of tomorrow’s Bank of Japan rate announcement, although given that any change is unlikely it is far from clear exactly what the market is waiting for. Yesterday’s Chinese GDP also failed to inspire FX markets, so pinning your hopes on the BOJ to liven things up would appear to be something of a long shot. The market feels slightly soft though, and it is our view that without a substantial positive external stimulus the market is likely heading lower. We would not feel that this view was invalidated unless it closed above 113.80, and we are ultimately looking for a test of support at 107.50. It is interesting to note that the US Dollar Index has remained fairly steady despite the US Government shutdown, underlining the fact that this is really a Democrat vs Republican spat and the market doesn’t see it as significant.