That's one argument an asset management firm in Tokyo is making
Asset Management One's chief strategist, Takeru Ogihara, argues that USD/JPY may be nearing its peak as there's still a lack of evidence of a global economic recovery. Adding that the recent rally has been driven by risk-on sentiment rather than underlying fundamentals.
In the bigger picture, Ogihara notes that the pair is expected to behave in a relatively subdued manner - similar to last year - as market volatility remains low and global bond yields are expected to stay in tight ranges.
He adds that the dollar is likely to stay rangebound this year as the Fed is expected to keep monetary policy on hold until the end of the year.
The range they are seeing for USD/JPY until the end of June is between 106 to 112. That is not too different from the range that we saw last year - besides the January flash crash and a bit of a fall in August as global stocks also corrected.