Goldman Sachs cites US growth prospects and BoJ bias to forecast USD/JPY rally to 155.00 in six months

Kamakshya Trivedi, a strategist at Goldman Sachs (GS), points out the fears of seeing a USD/JPY rally towards levels last seen in 1990 during his latest analysis article, shared by Bloomberg.

The GS analyst highlights Bank of Japan (BoJ) indecision to raise rates and US growth prospects as key catalysts to revise its six-month USD/JPY forecast to 155.00 from 135.00 previous.

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As long as the BoJ remains far from raising rates and equity markets remain reasonably well supported, the Japanese Yen should continue to trend weaker.

The main risk to this forecast of further weaker yen over the next six months is that rising inflation and currency depreciation prove more unpopular and catalyze stronger responses in the form of monetary intervention or an earlier hawkish turn. by the BoJ, or both.

Source: Fx Street

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