The Japanese Yen (JPY) remains stable against the US dollar (USD) but loses ground compared to all G10 currencies in an environment of widespread weakness of the USD as we approach the NA session on Friday, indicate the head strategists of FX of Scotiabank, Shaun Osborne and Eric Theoret.
The markets listen to rumors about an update of the forecasts of the BOJ
“The internal risk is elevated for the elections of the upper weekend house, since market participants consider the fiscal implications of the result and the possibility of sovereign credit sales in case of sliding.”
“In terms of foundations, the media report that the next quarterly perspective of the BOJ will offer a less worrying assessment about trade, growth and inflation. The BOJ has been forced to pause its increases in rates as a result of volatility of the bond market and uncertainty in commercial policy, the latter being a factor that complicates negotiations in the face of the weekend elections.”
“Unless there is a great setback for the LDP of the PM ishiba, we see that the short-term risk balance favors a JPY strength in the short term. For the USD/JPY, we wait for a return to the midpoint of its range of 142-148.50, with an objective in the 50-day mobile average in 145.20.
Source: Fx Street
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