USD/JPY should be well supported - Westpac

According to Robert Rennie, Research Analyst at Westpac, USD/JPY should be well supported on dips given that the Fed will raise rates in Dec and beyond and with the FOMC minutes noting that some participants “judged that it would be necessary to temporarily raise the federal funds rate above their assessments of its longer-run level”, Westpace remain happy with that view.

Key Quotes

“However, given the recent aggressive sell off in global equities, risk sentiment is likely to remain cautious. We thus stick to a neutral bias for the week ahead. However, we do see dips to 110.50/ 111 as a good buying opportunity and expect to see higher levels as we move through Q4 (114 yearend target).”