Credit Suisse on USD/JPY and EUR/USD

Credit Suisse discusses the USD outlook and maintains its EUR/USD and USD/JPY targets at 1.07, and 105 respectively in Q2.

"At a broad level, FX markets can best be characterised as exhibiting falling volatility in a relatively less dynamic environment. With USD libor rates also falling sharply, these conditions are typically associated with markets looking to add to risk, and for riskier currencies to try to outperform the greenback. Still, it is notable that the market remains far from ready to push aggressively for a lower USD, and few seem to anticipate a sell-off so rapid as to make early participation a definite necessity," CS notes.

"Where does this leave us in terms of our broad views? Frankly, not much changed from previous weeks. As for our G3 views, we see no need to change either our EURUSD 1.07 or our USDJPY 105 forecasts," CS adds.

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