Yen can stay strong despite Japanese officals – TDS

By FXStreet FXStreet (Guatemala) – Analysts at TD Securities explained that JPY longs look like the stronger hand.

See latest price action here as Yen hits fresh lows.

Key Quotes:

“We have turned increasingly JPY bullish in recent months and we see the yen as one of the better-performing G10 members in the weeks ahead. Indeed, the break below August’s 116.18 USDJPY panic lows suggests some further yen appreciation may be in the cards.”

“The Japanese economy has enjoyed a substantial boost to its terms of trade, benefitting greatly from the sharp decline in energy and other commodity prices. Japan’s growth outlook has stabilized while domestic deflation pressures are showing some signs of easing. Importantly, Japan’s external flows have improved substantially. This, combined with a still-cheap currency compared to its G10 peers could set the stage for a further JPY recovery.”

“Importantly, the focus is turning away from monetary policy for supporting growth in Japan. We think the BoJ is likely to disappoint persistent hopes for another round of monetary easing in the foreseeable future.”

“Instead, the focus there is turning to fiscal policy and wage increases to support growth. While the current round of annual wage negotiations are said to be off to a slow …read more

Source:: FX Street