24 Sep 2013
Flash: BoJ dovish for next year? - Rabobank
FXstreet.com (London) - Jane Foley, Senior Currency Strategist at Rabobank eyes the BoJ for next year with fears of a recovery in Japan stalling.
Key Quotes:
“The BoJ is another central bank will could be reasserting its dovish credentials at the start of next year. In the next couple of weeks PM Aso is due to announce his decision on whether to enact the planned April consumption tax hike”.
“The current consensus is that it will go ahead. Due to fears that the Japanese recovery could stall in Q2 next year as a consequence, there is currently a strong expectation that the BoJ could step up the degree of monetary stimulus”.
“On a 1 mth view the JPY has been the worst performing G10 currency suggesting that investors have again embraced the concept of the yen as a funding currency. However, these losses are more obvious against currencies were there could be a central bank rate hike next year. It remains the case that USD/JPY is likely to struggle to push and hold above the Y100 level until the USD finds some upwards traction”.
Key Quotes:
“The BoJ is another central bank will could be reasserting its dovish credentials at the start of next year. In the next couple of weeks PM Aso is due to announce his decision on whether to enact the planned April consumption tax hike”.
“The current consensus is that it will go ahead. Due to fears that the Japanese recovery could stall in Q2 next year as a consequence, there is currently a strong expectation that the BoJ could step up the degree of monetary stimulus”.
“On a 1 mth view the JPY has been the worst performing G10 currency suggesting that investors have again embraced the concept of the yen as a funding currency. However, these losses are more obvious against currencies were there could be a central bank rate hike next year. It remains the case that USD/JPY is likely to struggle to push and hold above the Y100 level until the USD finds some upwards traction”.