Goldman Sachs Research previews this week's June BoJ policy meeting.

"The BoJ looks set to hike by 25bp at its June meeting, continuing with its very gradual pace of tightening...Without a guide towards a faster pace of hikes, markets will remain most focused on the JPY-negative fundamentals of constrained monetary policy, higher-for-longer US yields, US growth outperformance, and domestic fiscal risks," GS notes.

"Overall, we continue to think that if our and market expectations for domestic monetary policy prove correct (i.e., only gradual tightening), it should have relatively limited impact on the Yen relative to the broader macro backdrop and US outlook, keeping the currency on the back-foot," GS adds.