Forex Flash: USD/JPY strategy profile – Westpac

FXstreet.com (Barcelona) - A lot of data is jammed into Friday’s slate, with a fair amount in the week ahead too. The economy watchers survey will be worth watching Friday given elevated levels. Also on Friday we have weekly MOF data (to 3 May) and more influentially, on Thu 16th. As we move into the post golden week period with summer bonus season not that far away, if Japanese investors are going to start buying into foreign bond markets any time, it should start to show up soon.

CGPI will also be eyed on Monday for any impact on domestic prices from the slump in the yen. Q1 GDP (Thu 16th) will be the marquee event for newswires but isn’t the place to look for the impact of Abenomics or Kuroda’s bold stance - not yet.

According to Global FX Strategist Sean Callow at Westpac, “We stick to a neutral bias on the USD/JPY for another week and still feel that recent softer price action has some way further to run. The market feels as if it remains on the back foot. We see USD/JPY in an ‘equilibrium range’ between 95.00 and 100.00, and would only start to get interested on buying sub our long standing 96.00 one month objective.”