• USD/JPY backslid 1.5% after the BoJ snuck in a quarter-point rate hike.
• The BoJ has chalked in its second rate hike since 2007.
• The US Fed’s latest rate call looms large as markets look for shifts in guidance.

USD/JPY tumbled 1.5% on Wednesday, extending a recent bearish downturn after the Bank of Japan (BoJ) delivered a surprise rate hike in the early hours of the Wednesday market session. It’s the second rate hike from the BoJ since 2007, and Japanese interest rates are above zero for the first time since September of 2010.

The Federal Reserve’s (Fed) latest rate call is expected to keep rates steady for the time being, but markets have widely forecast a first quarter-point rate trim when the Federal Open Market Committee (FOMC) convenes in September.