11 May 2015
USD/JPY could hit 126.00 in 12-month – Rabobank
FXStreet (Edinburgh) - The Japanese yen could depreciate towards 126.00 vs. its American counterpart in a 12-month horizon, suggested Jane Foley, Senior FX Strategist at Rabobank.
Key Quotes
“Once the impact of last April’s consumption tax hike is discounted, March CPI inflation is merely 0.2% y/y. Despite this BoJ Governor Kuroda’s tone has been upbeat”.
“If Kuroda is maintaining his upbeat assessment with the aim of supporting inflation expectations, there is a risk that the market can be blind-sided by news of furher easing as it was last October”.
“Back in October the impact of BoJ’s surprise decision on USD/JPY was amplified because it coincided with the end of the Fed’s QE policy”.
“Given our expectation that the BoJ will announce further policy measures this year and that the Fed is likely to hike interest rates in December, we see potential for USD/JPY to move towards 126 on a 12 mth view”.
Key Quotes
“Once the impact of last April’s consumption tax hike is discounted, March CPI inflation is merely 0.2% y/y. Despite this BoJ Governor Kuroda’s tone has been upbeat”.
“If Kuroda is maintaining his upbeat assessment with the aim of supporting inflation expectations, there is a risk that the market can be blind-sided by news of furher easing as it was last October”.
“Back in October the impact of BoJ’s surprise decision on USD/JPY was amplified because it coincided with the end of the Fed’s QE policy”.
“Given our expectation that the BoJ will announce further policy measures this year and that the Fed is likely to hike interest rates in December, we see potential for USD/JPY to move towards 126 on a 12 mth view”.