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1 Nov 2013
Flash: NZD/JPY to rally again towards 83.00/85.00 - TDS
FXstreet.com (Barcelona) - According to Annette Beacher, Singapore-based FX Strategist at TDS, NZD/JPY may reach levels as high as 100 and beyond due to ongoing and outsized BoJ easing.
Key Quotes
"For anyone who questions the effectiveness of BoJ easing, look at JGB 10yr yields over the past six months compared with Treasuries. JGB 10yr yields have steadily declined from 0.9% to 0.6% in recent months, compared with the violent jump in US Treasury yields to 3% over the same timeframe."
"Once the market’s need for finding safe havens in currency-land eases once again, we expect the yen to depreciate back to 100 by year-end, and towards 110 by end-2014."
"So contrasting this view with the robust NZD in the near-term at least, we expect NZDJPY to rally further to 83 by year end and 85 by end-2015, with risks firmly to the upside if the RBNZ’s macro-prudential tools prove to be ineffective in cooling housing demand, and OCR tightening starts from January 2014."
Key Quotes
"For anyone who questions the effectiveness of BoJ easing, look at JGB 10yr yields over the past six months compared with Treasuries. JGB 10yr yields have steadily declined from 0.9% to 0.6% in recent months, compared with the violent jump in US Treasury yields to 3% over the same timeframe."
"Once the market’s need for finding safe havens in currency-land eases once again, we expect the yen to depreciate back to 100 by year-end, and towards 110 by end-2014."
"So contrasting this view with the robust NZD in the near-term at least, we expect NZDJPY to rally further to 83 by year end and 85 by end-2015, with risks firmly to the upside if the RBNZ’s macro-prudential tools prove to be ineffective in cooling housing demand, and OCR tightening starts from January 2014."