USD/JPY seen at 118 in 12 months – Goldman Sachs

Goldman Sachs out with yet another outlook report, this time reviewing the Japanese economy and USD/JPY.

Key Quotes:

“Despite stronger Japanese growth, we have yet to see a pickup in price and wage inflation.

We are below consensus for Thursday's June wage report, where we expect overall wages to rise only 0.3%, a slowdown from May levels.

However, if the economy continues to strengthen, we will eventually see material shortages in labour and product markets, and we forecast $/Yen at 118 in 12 months (currently 110).”