Back
15 Apr 2015
JPY weakening against USD might slow – Nomura
FXStreet (Barcelona) - Yujiro Goto, FX Strategist at Nomura, notes that JPY weakening slowed after Abe’s advisor Hamada saw USD/JPY appropriate at 105, and with PM Abe set to meet US President Obama soon, the government’s negative stance on JPY weakness remains.
Key Quotes
“We do not expect Mr Hamada’s comments to have medium-term implications for the USD/JPY trend.”
“The timing of his comments, just after the first half of the nationwide regional elections, may increase market expectations that the Japanese government would not welcome further JPY weakness ahead of the second half of the elections on 26 April.”
“In reality, the LDP’s strong performance in the first half of the regional elections on Sunday suggests only a limited risk of the party losing many seats, regardless of the level of USD/JPY.”
“A stable political situation clearly suggested by the result of the first half of the regional elections should be positive for both Japanese equities and USD/JPY in the medium term, in our view.”
“Nonetheless, as Prime Minister Abe is also scheduled to visit the US from 26 April, markets may expect the government’s negative stance on further JPY weakness to continue for the time being.”
“As a result, the pace of JPY weakening against USD may slow for the time being, putting further downside pressure on EUR/JPY for now.”
Key Quotes
“We do not expect Mr Hamada’s comments to have medium-term implications for the USD/JPY trend.”
“The timing of his comments, just after the first half of the nationwide regional elections, may increase market expectations that the Japanese government would not welcome further JPY weakness ahead of the second half of the elections on 26 April.”
“In reality, the LDP’s strong performance in the first half of the regional elections on Sunday suggests only a limited risk of the party losing many seats, regardless of the level of USD/JPY.”
“A stable political situation clearly suggested by the result of the first half of the regional elections should be positive for both Japanese equities and USD/JPY in the medium term, in our view.”
“Nonetheless, as Prime Minister Abe is also scheduled to visit the US from 26 April, markets may expect the government’s negative stance on further JPY weakness to continue for the time being.”
“As a result, the pace of JPY weakening against USD may slow for the time being, putting further downside pressure on EUR/JPY for now.”