USDJPY: Post Yellen the risks would still appear to lie to the downside - Westpac

Robert Rennie, Research Analyst at Westpac, suggests that last week they shifted to a negative bias for USD/JPY and despite the fact that it really hasn’t gotten on with it, post Yellen the risks would still appear to lie to the downside.

Key Quotes

“We are increasingly to the view that increasing JGB purchases is no longer a viable outcome for the comprehensive review September 20/21.

Now that is not to suggest the BoJ does not have other potential policy levers: an aggressive operation twist; increased NIRP; increased ETF and possibly reopening the foreign bond debate are all potential options with varied risk/ reward. However, if markets want more JGB purchases, we are not sure this is possible.”