NZD/JPY retains downside potential - Westpac

NZD/JPY has spent some time consolidating between 78 and 79, but retains downside potential, 78.50 being the next major target, according to Imre Speizer, Research Analyst at Westpac.

Key Quotes

“Tensions on the Korean peninsula are boosting demand for the safe-haven yen, as is the BoJ’s slower pace of QE this year. The data calendar this week is light, with Q3 BSI on Wednesday and final IP on Thursday.”

“3 months ahead: The BOJ’s defacto tapering of its asset purchases should be yen supportive. In addition, the Japanese economy is seeing a pickup in consumer activity, mitigating any slippage in external demand. The 82 area should cap this cross during the quarter ahead.”