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10 Nov 2014
USDJPY uptrend to continue, 125 in 2015, 130 in 2016 - DB
FXStreet (Barcelona) - Taisuke Tanaka, Strategist at Deutsche Bank Group, views USD/JPY remaining on an uptrend as dips will invoke fresh long positions while forecasting 125-130 levels in 2015 and 2016 respectively.
Key Quotes
“We are seeing 125 at end-2015 and 125-130 in 2016 as new forecast. DB economist sees US economic growth at 3.5% in 2015 and 3.1% in 2016. Driven primarily by a firm US economy and the Fed's exit from super easing, and secondarily by the BoJ's QQE and an outflow from Japan, we think the USD/JPY will likely remain on an uptrend. We maintain our view that any dip would basically offer a opportunity to build longs.”
“We also “fine-tune” our forecasts to allow that the USD/JPY could exceed 125 in a next few years. Even if the USD/JPY reaches 120, we see Japan’s export volume not to grow strongly, the 2% inflation target not to be met, and fundamentals and policy combine not to deter yen depreciation. Breaking 124.14, the previous high in 2007, would provide technical impression on the end of 40-year cycle of "super" yen appreciation.”
Key Quotes
“We are seeing 125 at end-2015 and 125-130 in 2016 as new forecast. DB economist sees US economic growth at 3.5% in 2015 and 3.1% in 2016. Driven primarily by a firm US economy and the Fed's exit from super easing, and secondarily by the BoJ's QQE and an outflow from Japan, we think the USD/JPY will likely remain on an uptrend. We maintain our view that any dip would basically offer a opportunity to build longs.”
“We also “fine-tune” our forecasts to allow that the USD/JPY could exceed 125 in a next few years. Even if the USD/JPY reaches 120, we see Japan’s export volume not to grow strongly, the 2% inflation target not to be met, and fundamentals and policy combine not to deter yen depreciation. Breaking 124.14, the previous high in 2007, would provide technical impression on the end of 40-year cycle of "super" yen appreciation.”