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5 Feb 2015
USD/JPY downside risks – BTMU
FXStreet (Barcelona) - Lee Hardman, Currency Analyst at Bank of Tokyo-Mitsubishi UFJ, expects the narrowing US-Japan yield gap to support JPY purchase and fuel a further downside for USD/JPY.
Key Quotes
“Non-farm payroll report is the upcoming key data for USDJPY next week.”
“The recent US economic data was weaker than market expectation. The optimism of the US economic recovery was declining. The better data may not support US dollar buying.”
“The top side of USD/JPY at around 118 level may be heavy.”
“In addition, the US-Japan yield gap was narrowing due to the JGB yield rise. The yield gap narrowing will likely support JPY purchase.”
“Until the testimony by Yellen, the lower bound of USDJPY may be 115-level as the Fed’s rate hike expectation will remain.”
“In the coming week, the downside probability of USDJPY may grow further.”
Key Quotes
“Non-farm payroll report is the upcoming key data for USDJPY next week.”
“The recent US economic data was weaker than market expectation. The optimism of the US economic recovery was declining. The better data may not support US dollar buying.”
“The top side of USD/JPY at around 118 level may be heavy.”
“In addition, the US-Japan yield gap was narrowing due to the JGB yield rise. The yield gap narrowing will likely support JPY purchase.”
“Until the testimony by Yellen, the lower bound of USDJPY may be 115-level as the Fed’s rate hike expectation will remain.”
“In the coming week, the downside probability of USDJPY may grow further.”