USD/JPY could extend the upside to 126.00 in the medium term – Rabobank

FXStreet (Edinburgh) – Jane Foley, Senior Currency Strategist at Rabobank, believes the pair could reach the 126.00 level in the upcoming months.

Key Quotes

“USD/JPY rose to levels last seen in 2002 this morning as Japan’s Chief Cabinet Secretary Suga highlighted the undesirability of volatility in FX markets but refrained from talking up the value of the yen. While Suga’s comments may have added extra support to USD/JPY the ability of the current pair to break above its recent trading range has been facilitated by a recovery in the tone of the USD”.

“The minutes of last month’s BoJ policy meeting show that the committee discussed the Bank’s current projection that CPI inflation is projected to reach 2% around the first half of 2016, with some members proposing various amendments to water down this outlook – all of which were defeated”.

“It is our view that the BoJ will announce further QQE policy initiatives this year to drive home its commitment to its 2% inflation target. On the back of our view that the Fed will hike rates in December we expect USD/JPY to trend towards 126.00 in the coming months”.

Jane Foley, Senior Currency Strategist at Rabobank, believes the pair could reach the 126.00 level in the upcoming months…

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