Strategists at Credit Suisse look for more USD strength in the second quarter. Their expected USD/JPY range is 107-114 and they are buyers on dips to the lower end.
Covid policy not a source of JPY support any more
“Japan is among the global vaccination laggards even as domestic media fret about the risk of a local ‘fourth wave’, suggesting covid risks are now potentially a JPY negative. This, together with wider rate differentials, prompts us to look for further JPY weakness in Q2 if global markets stay robust, with a USD/JPY 112.50 target.”
“Depressed inflation means changes to monetary policy announced at the 18-19 March Bank of Japan’s meeting did not shift this sentiment, as the central bank remains committed to purchasing more Topix ETFs (up to JPY12 trn annually) and unlimited amounts of JGBs as needed.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.