The Yen's weakness can continue – Erste Group
|Monetary policy argues for further weakness of Yen, analysts at Erste Group Research report.
There is still a lot to be said for the Euro from a fundamental perspective
The Bank of Japan's control of the yield level of 10-year Japanese government bonds (within a target corridor of 50 bps above or below a yield level of 0%) continues to be the determining factor for the development of the JPY. By contrast, German 10-year government bonds are currently comparatively attractively priced with a yield level of around 2.6%. Since core inflation in both currency areas is close to the same level, there is still a lot to be said for the Euro from a fundamental perspective.
The Yen's weakness can therefore continue, provided there are no fundamental changes in the BoJ's monetary policy.
In the event of an escalation of crises, the Yen can also quickly strengthen against the Euro again at any time.
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.