JPY: Guided by the Japanese politics - ING

Sandeep Kanihama FXStreet Contributor

Viraj Patel, Research Analyst at ING, suggests that it’s a brave move to bet against the JPY in a world of Trumpian uncertainties and a breather in USD/JPY’s year-to-date bearish trend isn’t surprising given the sharp swing in JPY positioning that has occurred over this period (speculative markets moved from 54% net JPY short to 2% net JPY long).

Key Quotes

“While FX markets seem to be shrugging off any global trade or geopolitical flare-ups for now, we remain wary that we’re one move (or tweet) away from any escalation that could bring about a broader flight-to-safety. Japanese politics should also be added to the list of reasons for seeking haven in JPY – with PM Abe’s approval ratings at their lowest since Dec 2012, and ex-PM Koizumi stirring up the resignation rumours, it’s certainly a far from settled domestic political backdrop. USD/JPY could trade firm ahead of a crucial April BoJ meeting, but we remain sellers on any rallies.”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

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