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BOJ still sees Yen weakness as not negative - Nomura

FXStreet (Bali) - BOJ still sees JPY weakness as not negative, comments Yujiro Goto, FX Strategist at Nomura.

Key Quotes

"BOJ Governor Kuroda appeared in parliament today, reiterating his positive outlook on inflation momentum. Governor Kuroda said CPI gains should speed up in the second half of FY2014, while the Bank will aim to reach the 2% inflation target as soon as possible."

"As USDJPY appreciation accelerated in September, fewer BOJ watchers now expect the Bank to ease by the end of December, according to Bloomberg. Our latest client survey shows a higher expectation for BOJ easing among offshore investors than domestic investors so there may still be a small dip after the meeting."

"Governor Kuroda’s views on the FX market are also important for JPY, after USD/JPY broke 110 this week. He repeated today that the weak JPY will not cause problems if it reflects fundamentals and that he does not see a weak JPY as a negative for the economy overall."

"We expect him to reiterate his relatively positive view on JPY weakness at the press conference next week, supporting mid-term JPY weakness into 2015."

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