JPY seen appreciating vs. USD and EUR – Commerzbank
|In opinion of Axel Rudolph, Senior Analyst at Commerzbank, the Japanese safe haven currency is expected to pick up traction in the next months vs. the greenback and the European currency.
Key Quotes
“On announcing that it will allow a higher fluctuation margin around its 10-year yield target, the Bank of Japan (BoJ) has made a fateful decision for the yen. The market should interpret this as a signal that the BoJ cannot and will not permanently maintain a low interest level – even if it states the opposite – given its concerns for the banking sector’s ability to function and the market is thus likely to bet on a further rising yield level and consequently a stronger yen”.
“For this reason, we have changed our yen forecast and no longer expect the yen to depreciate but appreciate against the US dollar and euro”.
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