USD/JPY Seen at 112.00 in 3-Month – Danske Bank
Senior Analyst at Danske Bank Morten Helt sees the BoJ incurring in
further easing in the near term and thus pushing spot to the 112.00
handle in 1-3 months.
Key Quotes
“In the
short term, we think the strong downtrend in USD/JPY is likely to
persist – at least until disrupted by policy action. If USD/JPY
continues to fall further in the coming weeks, the risk is that the BoJ
might act before its monetary policy meeting on 28 April”.
“Stretched short-term FX drivers such as positioning and technical indicators imply BoJ
easing might be able to counter the strong downward pressure on USD/JPY
stemming from fundamentals. We look for a stabilisation of USD/JPY above 110 targeting the cross at 112 in 1-3M”.
“We remain bearish on the JPY on a six- to 12-month horizon versus both the
USD
and EUR due to a combination of cyclical and monetary policy divergence
and we recommend positioning for a weaker JPY ahead of 28 April”.
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