Adam sent me this for posting and it’s certainly a bold call by Kazuhiko Sano the chief bond strategist at Tokai Tokyo who says he sees 85 “by this fall”
USDJPY is trading within 1% of its fair value of 102.61 implied in the OECD’s measure of purchasing power parity and weakened beyond the threshold for the first time since 1985 last year
The PPP index shows the yen weakness has gone too far, signaling a strengthening trend. The BOJ’s inflation target will be difficult to achieve without the yen reaching 120 against the dollar.
Sano, who in May 2012 correctly predicted last fiscal year’s plunge in Japan’s benchmark bond yield to 0.5%, forecasts a record low of 0.25% this year as the yen strengthens.
Bloomberg has more here
