A Japanese Giant To Watch
USDJPY is testing 100 this morning in Asia after the G20 meetings resulted in little criticism of Tokyo’s policies. We think the currency pair is likely to trade above 100 in the near term as Japanese investors start to shift more funds abroad and expect the yen to weaken to 110 by year end. In the week ahead, the Bank of Japan meets and publishes its semi-annual economic outlook report. The central bank is set to forecast inflation rising to 2% by the spring of 2015. In doing so the BoJ will signal that it is fully committed now to meeting its inflation target within the next two years. That should keep USDJPY and the Nikkei supported.
Click here to read the full report: UBS
UBS