Credit Suisse discusses USD/JPY outlook and maintains a neutral bias in the near-term.
"Recent weakness in risky assets might also account for the evidence appetite for topside positioning in USDJPY. As for our views, on 3 May we adopted a wide range in USDJPY between 125.80 and 135.15. At the time we expressed a bias towards the topside, but limited willingness to take a strong directional position given the potentially transformational impact of the CPI data," CS notes.
"While risk reversal skew metrics suggest that conditions for topside position has become somewhat more attractive, we still prefer to adopt a wait and see approach for now and stand ready to fade moves towards the lower end of our target range," CS adds.
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