Citi FX outlook
The fundamental backdrop remains bearish for JPY as – (1) UST yields continue to rise steadily leaving US – Japan rate differentials weighing on JPY; and (2) Japanese investor flows not favoring a stronger Yen – recent monthly data from Japan’s MoF do show Japanese investors turning net buyers of foreign bonds. The team remains bullish JPY vs USD, targeting a rising channel base at 109.11-15.
Previously
- USDJPY: 6 – 12 months: 112.0
- USDJPY: Longer term: 112.0
Currently (as of Oct):
- USDJPY: 6 – 12 months: 114.0
- USDJPY: Longer term: 112.0
MT Bias: Turning more neutral JPY vs USD; Bullish JPY vs EUR, CHF
Tactically modestly bearish JPY vs USD
Tactically bearish JPY vs Commodity FX (AUD, NZD & CAD), GBP and Asia EMFX (CNH & SGD)
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