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16 Jul 2015
USD/JPY to remain supported by higher US interest rates – Danske Bank
FXStreet (Mumbai) - As per Danske Bank analyst, the USD/JPY pair could rise to 123 in next one month as the USD would remain supported by higher interest rates in the US.
Key Quotes
“Fundamentally, the JPY has become substantially undervalued resulting in increased political resistance to further depreciation. Hence, we expect more verbal defence of the JPY to curb upside potential for USD/JPY, which in addition should result in more two-way volatility in the cross.”
“On a 6M to 12M horizon, we expect USD/JPY to enter another period of range trading as support for the USD eases following the first Fed hike in September. Longer term, support to the JPY should increase as the Japanese trade balance looks set to continue. We have kept our 12M forecast unchanged at 127.”
Key Quotes
“Fundamentally, the JPY has become substantially undervalued resulting in increased political resistance to further depreciation. Hence, we expect more verbal defence of the JPY to curb upside potential for USD/JPY, which in addition should result in more two-way volatility in the cross.”
“On a 6M to 12M horizon, we expect USD/JPY to enter another period of range trading as support for the USD eases following the first Fed hike in September. Longer term, support to the JPY should increase as the Japanese trade balance looks set to continue. We have kept our 12M forecast unchanged at 127.”