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5 Jul 2013
Flash: USD/JPY, bias neutral going into next week - BTMU
FXstreet.com (Barcelona) - Less volatility in the markets on China short-term money markets becoming more stable, was a key theme that the Bank of Tokyo Mitsubishi UFJ highlights before commenting on the USD/JPY outlook.
BTMU notes also how "The Japanese Tankan survey and the CPI data for May were signs of economic recovery and easing deflationary pressures, sitting nicely with the goals of Abenomics." The Bank believes "the expectation for real interest rates to decline may help encourage yen selling", also supported by retail investment outflows from Japan, BTMU said.
However, BTMU suggests not to overlook events like this week's in Portugal, which may result on "yen undergoing sudden periods of short position liquidation that might temporarily lift the yen" the Bank said. In short, the BTMU believes that these opposing factors leave a neutral picture for USD/JPY going into next week.
BTMU notes also how "The Japanese Tankan survey and the CPI data for May were signs of economic recovery and easing deflationary pressures, sitting nicely with the goals of Abenomics." The Bank believes "the expectation for real interest rates to decline may help encourage yen selling", also supported by retail investment outflows from Japan, BTMU said.
However, BTMU suggests not to overlook events like this week's in Portugal, which may result on "yen undergoing sudden periods of short position liquidation that might temporarily lift the yen" the Bank said. In short, the BTMU believes that these opposing factors leave a neutral picture for USD/JPY going into next week.