7 Jan 2015
Yen is undervalued - BAML
FXStreet (Guatemala) - Analysts at Bank of America Merrill Lynch noted the conditions surrounding the Yen’s weakness.
Key Quotes:
“Back in September, we highlighted the case that increasing outward portfolio investment by Japanese investors would weaken the yen against major currencies, together with Abe’s political strategy and monetary policy repricing".
"The snap election-positive tail-risk for the US$/¥-and the BoJ's additional easing, which went far beyond market expectations, have played out and weakened the yen significantly, setting up a key policy background for 2015."
"How did and will Japanese money-the remaining factor-react? The question is important in assessing further downside of the yen, the most undervalued currency in our valuation matrix."
Key Quotes:
“Back in September, we highlighted the case that increasing outward portfolio investment by Japanese investors would weaken the yen against major currencies, together with Abe’s political strategy and monetary policy repricing".
"The snap election-positive tail-risk for the US$/¥-and the BoJ's additional easing, which went far beyond market expectations, have played out and weakened the yen significantly, setting up a key policy background for 2015."
"How did and will Japanese money-the remaining factor-react? The question is important in assessing further downside of the yen, the most undervalued currency in our valuation matrix."