USD/JPY neutral outlook for the week ahead – BTMU

FXStreet (Barcelona) - According to Takahiro Sekido of Bank of Tokyo Mitsubishi UFJ, next week’s events might support both JPY buying and selling, as such the pair is expected to remain confined in its recent narrow range.

Key Quotes

“The dovish FOMC minutes exhilarated the US treasury buying and the US dollar selling.”

“Next week, Yellen may not address her hawkish stance in the upcoming testimony.”

“In addition, Japan’s trade deficit was narrower than market expectation and supported the upper side of USDJPY. Furthermore, the BoJ revised its assessment of export and production upward. The contexts of the sale tax hike negative impact were removed from the statement.”

“The market expectation for extramonetary easing will likely decline further and support USDJPY selling.”

“On the contrary, the lingering anticipation for the Fed rate hike and the yield gap between the US and Japan will continue to support the momentum for USDJPY buying.”

“The JP postal bank’s acquisition of the Australian logistics company may support JPY selling.”

“All in all, USDJPY will likely stay at around the recent narrow range.”

“USD/JPY – Neutral Bias – (117.00-120.00)”