USD/JPY: Any substantial upward move to be only temporary in nature – Commerzbank

Things are going in the right direction for the Bank of Japan (BoJ). The USD/JPY is likely to remain volatile but a substantial rise is not on the cards, in the view of economists at Commerzbank.

There is some relief on the exchange rate side

“In June it had seemed concerned in view of a 15% depreciation of the yen against the US dollar and stressed that it would keep a close eye on the developments on the FX market. Since then, the USD/JPY exchange rate has stabilised even though it is likely to remain volatile.”

“In view of the BoJ’s inability to act, USD/JPY is completely at the mercy of the USD side of things. However, in line with our in-house view that the Fed will cut interest rates in view of an economic slowdown in the coming year, any substantial upward move is likely to be only temporary in nature.”