Forex Flash: USD/JPY consolidation likely next week - Nomura
Forex pairs in this Article »
USD/JPY
FXstreet.com (San Francisco) - In its G10 FX Portfolio Update, Nomura sees two main near-term trading scenarios for USDJPY:
[1] "First, there may be essentially a front-loaded repricing of the yen, based on the expectation that a major shift within the BOJ is happening in the coming month. This could see the USDJPY trade to near 85 before year-end (several months before our current forecast). This scenario has perhaps a 20-30% probability.
[2] "Second, there may be a period of consolidation, with spot trading temporarily back towards the 80 level. This could materialize because of lack of the follow-through from the BOJ next week, temporarily better Japanese trade data (also next week), and possibly also continued uncertainty about the resolution of the fiscal cliff situation in the US. This is probably the most likely scenario."
USDJPY currently exchanges at 81.10.
[1] "First, there may be essentially a front-loaded repricing of the yen, based on the expectation that a major shift within the BOJ is happening in the coming month. This could see the USDJPY trade to near 85 before year-end (several months before our current forecast). This scenario has perhaps a 20-30% probability.
[2] "Second, there may be a period of consolidation, with spot trading temporarily back towards the 80 level. This could materialize because of lack of the follow-through from the BOJ next week, temporarily better Japanese trade data (also next week), and possibly also continued uncertainty about the resolution of the fiscal cliff situation in the US. This is probably the most likely scenario."
USDJPY currently exchanges at 81.10.
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