12 Dec 2014
Consensus forecasts USD/JPY to rise to 124 by 2015 end – TDS
FXStreet (Barcelona) - Shaun Osborne, FX Strategist at TD Securities, notes that the consensus forecasts 124 levels for USD/JPY by 2015-end, but weak growth and aggressive policy may lead the pair through 130-140.
Key Quotes
“Looking at Bloomberg's tabulation of bank forecasts for the coming year, USDJPY is expected to rise to 124 by the end of 2015, according to the consensus of forecasts. The low of the forecast range is 105, the high 135. We stand a little above the median estimate at 125.”
“We think the die is largely cast for the EUR and JPY from the domestic perspective. At best, growth and policy divergences largely pan out as expected and even under that scenario, our forecasts are probably not unreasonable. At worst, weak growth and more aggressive policy moves lead to even deeper losses for these currencies – the EUR towards the low teens and USDJPY through to 130-140. If we are talking about risks, one is certainly that the consensus is too conservative.”
Key Quotes
“Looking at Bloomberg's tabulation of bank forecasts for the coming year, USDJPY is expected to rise to 124 by the end of 2015, according to the consensus of forecasts. The low of the forecast range is 105, the high 135. We stand a little above the median estimate at 125.”
“We think the die is largely cast for the EUR and JPY from the domestic perspective. At best, growth and policy divergences largely pan out as expected and even under that scenario, our forecasts are probably not unreasonable. At worst, weak growth and more aggressive policy moves lead to even deeper losses for these currencies – the EUR towards the low teens and USDJPY through to 130-140. If we are talking about risks, one is certainly that the consensus is too conservative.”