USD/JPY: There is a lot pointing towards higher levels – Commerzbank
|JPY continued its downtrend against USD on Monday. Economists at Commerzbank analyze Yen’s outlook.
A weaker JPY seems fundamentally justified
If JPY were to depreciate further, it is quite possible that there will be further interventions. These are unlikely to have much of an effect though. Since the BoJ does not want to move away from its ultra-expansionary monetary policy despite comparatively high inflation rates, a weaker JPY seems fundamentally justified.
A weaker USD would improve the situation, but at present the market seems to be betting on a stronger USD. The solid US economy and hawkish comments by Fed members support USD at present. Everything all told, there is a lot pointing towards higher levels in USD/JPY.
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