Forex
Home›Forex›Major Pairs›Yen stays weak versus dollar as strategists cite Japan…
Yen stays weak versus dollar as strategists cite Japan growth outlook
USD/JPY is back above 159.00 after bouncing from around 158.00, with analysts warning intervention threats alone are unlikely to drive a sustained yen rally.
The Japanese yen (JPY) extended losses against the US dollar (USD) in a calm session, with USD/JPY returning above 159.00 after bouncing from lows near 158.00 and moving toward the 160.00 level. FXStreet notes that strategists say the mere threat of intervention is not enough to produce a durable yen recovery.
Societe Generale analysts argued that a more sustainable rebound would depend less on interest rate differentials and more on an improvement in Japan’s domestic growth outlook. They pointed to current consensus growth averaging about 0.75% for this year and next, while warning that this still remains well below levels seen before the Gulf conflict lifted oil prices.
BNY Mellon analysts highlighted concerns about Japan’s fiscal balance, citing portfolio flow data that show foreign investors stepping up sales of Japanese government bonds. The firm said foreign investors accelerated JGB selling last week with net outflows of ¥1.25tn, bringing year to date foreign net purchases to ¥4.99tn, the lowest cumulative level since early February.
UOB Group retained a mildly negative bias on USD/JPY but said it is not enough for a significant yen recovery near term. The bank expects USD to edge lower in the next one to three weeks but for any decline to remain contained within a 156.60 to 159.60 range, arguing momentum is starting to build yet is insufficient for a sustained drop.
Latest closeUSD/JPY 159.31 ▼0.1%