EUR/JPY: to trade in range near-term and higher long-term - Danske Bank

Analysts from Danske Bank look for EUR/JPY to trade in the range 128/135 in 3M and they have a target for the pair at 141.50 in six months. 

Key Quotes: 

“EUR/JPY has proved to be less sensitive to negative risk sentiment driven by North Korean woes (declines in USD/JPY have been echoed by drops in EUR/USD). However, if the crisis escalates significantly, EUR/JPY would also take a plunge in our view. We look for EUR/JPY to trade in the range of 128-135 in the near term, targeting 135 in 3M.” 

“Longer term, we expect EUR/JPY to continue higher driven by real interest rates and portfolio outflows out of Japan as we expect the ECB to move towards monetary policy ‘normalisation’ before the BoJ. We target EUR/JPY at 141.50 in 6M and 145 in 12M.”

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