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USD/JPY better bid ahead of NFP's - BTMU

FXStreet (Guatemala) - Analysts at Bank of Tokyo Mitsubishi explained that although there were no surprises from the BoJ last week USD/JPY has been drifting slowly higher, supported by renewed expectations of a Fed rate hike on 16th December.

Nonfarm Payrolls: Can it confirm a December rate hike?

Key Quotes:

"The fact that Japanese equity markets have performed well, perhaps in part due to Japan Post Bank’s IPO, further helps the positive USD/JPY sentiment."

"Friday’s US non-farm payroll data may encourage USD/JPY buying if it comes in better than market expectations. The prospects for a continued rise in USD/JPY may by questioned given US equity market valuations start to look more stretched - overall P/E levels have hit around 17.

At the same time, the recent US 2-year UST bond rate tipping just over 0.8% may start to weigh on US stock market sentiment as well. Market expectations for further monetary easing by the ECB will likely weaken EUR but not JPY, amongst major currencies."

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