JPY: Further weakness coming in the few weeks - SocGen

Kit Juckes, Research Analyst at Societe Generale, notes that the merest whisper of further BOJ action at Thursday’s meeting was enough to scare some of the yen longs (and revive interest in the Nikkei).

Key Quotes

“Most likely is that the BOJ will borrow from the ECB playbook and lower the cost of some loans to banks, to help offset the effects of January’s move. That won’t have much significance, and it’s not surprising that the yen is a bit stronger this morning.

However, I do think the CFTC data accurately reflect short-term market sentiment and as Japanese demand for foreign assets remains incredibly strong, we look for further yen weakness in the few weeks.”