Dollar/yen is flirting with the highs, topping 112. Will it continue further to the upside? The team at BTMU weighs in:
Here is their view, courtesy of eFXnews:
BTMU FX Strategy Research argues that while the JPY has weakened modestly, there must be a risk of greater underperformance over the coming days and weeks if these market conditions persist.
“After a period of heavy repatriation of foreign securities investment by Japanese investors that flow has started to reverse again. In the first four months of 2017, Japanese investors sold JPY 7,938bn worth of foreign bonds but weekly data in May and June to the week ending 16th shows Japanese investors have bought JPY 4,976bn,” BTMU adds.
“Low volatility and generally favourable market conditions may entice a greater portion of un-hedged purchases, helping to weaken the yen,” BTMU argues.
For lots more FX trades from major banks, sign up to eFXplus
By signing up to eFXplus via the link above, you are directly supporting Forex Crunch.Get the 5 most predictable currency pairs