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USD/JPY: Possible move below 120 by the end of the year – Nordea

Nordea’s economists are quite bullish on the yen and expect it to USD/JPY could fall below 120 by the end of the year.

Monetary policy convergence should support JPY

“With inflation at its highest point in decades and prospects for higher wage growth, the time will have come to normalize the monetary policy of the Bank of Japan, which is very accommodating. This will support further yen strengthening, moving below 120 towards the end of the year“.

“The full reopening of Japan to foreign tourists, particularly from China, should also support a stronger JPY.”

“By last, the yen’s safe-haven status should prove useful if the negative risk outlook for the global economy and stock markets materializesand other G10 central banks are forced to cut rates, as markets currently expect.”

Source: Fx Street

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