Yen carry unwind risks are back!

Markets kicked off the week on a mixed note. Asian tech stocks followed Wall Street higher on renewed excitement around OpenAI and the race toward AGI, while European equities struggled under the weight of rising energy prices, weak German industrial production and expectations of an ECB rate hike. The major focus however was the sharp rise in the Japanese yen and the rising risk of a carry unwind. Years of cheap Japanese funding encouraged investors to borrow in yen and pile into higher-yielding assets, pushing classic carry pairs such as AUD/JPY to extreme levels. But today, with the Bank of Japan potentially turning more hawkish, those trades could become increasingly vulnerable. Listen to find out more! Ipek Ozkardeskaya has begun her financial career in 2010 in the structured products desk of the Swiss Banque Cantonale Vaudoise. She worked at HSBC Private Bank in Geneva in relation to high and ultra-high net worth clients. In 2012, she started as FX Strategist at Swissquote Bank. She worked as a Senior Market Analyst in London Capital Group in London and in Shanghai. She returned to Swissquote Bank as Senior Analyst in 2020, and launched her own website ipekScope.com in 2025.