As markets brace for Wednesday’s Bank of Japan (BoJ) monetary policy meetings, multiple investment banks and analysts convey their forecasts for the USD/JPY pair that’s been lately gaining more attention, especially after the BoJ’s tweak to the Yield Curve Control (YCC).

Analysts at Goldman Sachs (GS) are from the same lot and anticipate the Yen pair to decline further by suggesting a 3.0% drop, or a fall to just below the 125.00 level. However, the GS also states that the bigger driver of the cross should be US rates rather than domestic monetary policy.

The GS also signals that their economists expect the BoJ to keep YCC in place with possible further tweaks to improve its sustainability. However, the increased risk of a complete exit means they see more limited room for USD/JPY upside.

Also read: USD/JPY Price Analysis: Bulls on course for a 129.50 target