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USD/JPY stays neutral near-term – Westpac

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 10, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    In opinion of strategists at Westpac, the pair’s outlook remains on the neutral side for the upcoming sessions.

    Key Quotes

    “The BoJ’s surprise move on negative deposit rates on selected deposits failed to garner much support for a weaker ¥”.

    “Kuroda’s statement that the BoJ “will do whatever we can to achieve the price stability target of 2 percent” the same. With the ¥ being driven by the ebb and flow of risk sentiment and market positioning, it’s hard to have anything other than a short term view here”.

    “However, Kuroda sounded like he really meant it – indeed he sounded quite like Draghi did in his “ready to do whatever it takes … believe me, it will be enough” 2012 speech”.

    Kuroda’s declaration that it is possible to further cut the interest rate (citing ECB, SNB, Riksbank), expand JGB purchases and address “quality dimensions” means the market will likely be pricing more action in April”.

    “So while we maintain a neutral bias for another week, we still see the possibility that the BoJ does react to ¥ appreciation. Neutral for now, but would quickly flip to a buy if global financials settle down”.
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