- Analytics
- News and Tools
- Market News
- USD/JPY: Yen to remain relatively weak for the foreseeable future – Scotiabank
USD/JPY: Yen to remain relatively weak for the foreseeable future – Scotiabank
USD/JPY continues to fluctuate wildly. The Japanese yen is enjoying a relief rally but the broader outlook suggests the JPY is unlikely to rebound significantly at this point, economists at Scotiabank report.
JPY may correct but challenges remain
“Nominal yield differentials are a powerful source of support for the USD at the moment. Wide yield spreads also make the JPY an expensive long (and an attractive funding currency). Commodity prices are liable to remain elevated, weakening Japanese terms of trade. As a consequence of rising import costs, Japan’s external accounts position has weakened in recent months which has served to undermine its safe-haven position.”
“Market positioning has perhaps become too bearish and is due a correction. Seasonal trends typically turn a little more bearish for USD/JPY from this point of the year.”
“A push back under 120 may be possible in the next 2-4 weeks but we think the risk of the Fed lifting rates 50bps at the May 4th FOMC (and perhaps signaling that the pace of tightening is picking up over the next few meetings) will limit scope for USD losses and keep USD/JPY well-supported in the 118-120 zone.”
© 2000-2024. All rights reserved.
This site is managed by Teletrade D.J. LLC 2351 LLC 2022 (Euro House, Richmond Hill Road, Kingstown, VC0100, St. Vincent and the Grenadines).
The information on this website is for informational purposes only and does not constitute any investment advice.
The company does not serve or provide services to customers who are residents of the US, Canada, Iran, The Democratic People's Republic of Korea, Yemen and FATF blacklisted countries.
Making transactions on financial markets with marginal financial instruments opens up wide possibilities and allows investors who are willing to take risks to earn high profits, carrying a potentially high risk of losses at the same time. Therefore you should responsibly approach the issue of choosing the appropriate investment strategy, taking the available resources into account, before starting trading.
Use of the information: full or partial use of materials from this website must always be referenced to TeleTrade as the source of information. Use of the materials on the Internet must be accompanied by a hyperlink to teletrade.org. Automatic import of materials and information from this website is prohibited.
Please contact our PR department if you have any questions or need assistance at pr@teletrade.global.
Bank transfers
