GS with a 103 projection for USD/JPY in the next 12 months
GS say that in the medium term USD/JPY may rise, due to boosts from the vaccine surge in growth and inflation
- But then heads lower as aggressive Fed hike bets are cut back ... "We expect no hikes until 2024, whereas markets price about three hikes before then"
- "In the second half of 2021, when we will be on the other side of the vaccine-led surge in US activity, and when Japan's own vaccination campaign should be catching up, we expect USD/JPY to turn lower again"
More:
- speculative yen shorts have accumulated despite the lack of evidence of Japanese foreign bond purchases accelerating
- a swing from longs to shorts in Q1 likely helped yen depreciation and this pressure on the currency is likely gone
- GS say also that the yen is cheap relative to longer-term valuation
---
Meanwhile, Tokyo markets are open for the day and USD/JPY has jumped a little higher (US yields firmer):
The dollar is seeing bids against other major FX at the same time also.
