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Forex pairs in this Article » USD/JPY
FXStreet (Guatemala) - RBS strategists suggest USD/JPY is weak.

Key Quotes:

"USD/JPY is starting to reveal a bit of support, having testing below 102 overnight and rebounded relatively quickly".

"This helps establish its credentials, building on the recovery since the lows below 101 two weeks ago".

"It looks poised to potentially make a move back to the 103/105s from earlier in the year provided global risk appetite can retain its relative stability".

"Reasons to look to sell JPY include the weak trade balance and recent weaker than expected Japanese data that suggests that the BoJ may yet need to further enhance its QE policy".

"Another is the rising inflation expectations in Japan in inflation linked bonds. These have continued to rise to new highs relatively rapidly this year, where as they have declined significantly in the UK and Eurozone and been stable in the US. Consequently the 5yr real yield spread suggests that, despite the dip in nominal yields, the USD/JPY should be trading at new highs".
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