USD/JPY: Risks remain to the downside heading into Jackson Hole – Goldman Sachs

The US investment banking giant, Goldman Sachs’s co-head of Global FX and EM strategy, Zach Pandl, recommends going long the Yen in the lead up to the key risk event for markets this week, the Fed’s Jackson Hole Symposium.

Key Quotes:

"If the Fed signals substantial easing to come, there will be a narrowing in rate differentials and that should push USD/JPY lower.

Alternatively, any emphasis on still-decent domestic growth data and a wariness of deep rate cuts would lead to risk assets to underperform to the benefit of havens like the yen."

Any risk for the yen this week lies with "any additional reprieve" in the US-China trade conflict.”