11 Feb 2016
USD/JPY: markets expecting BoJ intervention - BTMU
Analysts at Bank of Tokyo Mitsubishi explained seasonal Japanese investor cash repatriation has encouraged USD/JPY drop.
Further, foreign tourists—chiefly Chinese visitors over the Chinese New Year—have supported JPY buying. Exporters have been recovering slowly, also pushing USD/JPY lower.
The BoJ’s negative interest rate policy under QQE has not encouraged risk sentiment to recover yet. Looking ahead, US retail sales and Japan’s 4Q GDP data may test USD/JPY direction. Weak data could propel USD/JPY further down.
The sharp strengthening of the yen has fuelled speculation that Japan could intervene directly to dampen yen volatility. Officials have already intervened verbally signalling concern over recent yen moves."
Further, foreign tourists—chiefly Chinese visitors over the Chinese New Year—have supported JPY buying. Exporters have been recovering slowly, also pushing USD/JPY lower.
The BoJ’s negative interest rate policy under QQE has not encouraged risk sentiment to recover yet. Looking ahead, US retail sales and Japan’s 4Q GDP data may test USD/JPY direction. Weak data could propel USD/JPY further down.
The sharp strengthening of the yen has fuelled speculation that Japan could intervene directly to dampen yen volatility. Officials have already intervened verbally signalling concern over recent yen moves."