Jpy Under Pressure Rabobank

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Jpy Under Pressure Rabobank

Japanese Yen (Jpy) Under Pressure

Political uncertainty in Japan isn't coming to an end, and it is now also putting the Japanese Yen (JPY) under pressure. If it continues, it could have a long-lasting impact on the JPY, according to Rabobank.

few months back, there was hope that the Upper House election would bring an end to political uncertainty. However, that was not the case, and now the JPY is suffering from it.

Political Uncertainty Weighs On Jpy

According to Rabobank, many big party officials are also getting ready to resign. If that happens, it would seriously stir up trouble for one of the biggest parties in Japan.

In fact, there are reports that even the Japanese PM is thinking about resignation. Now, this means a lot of uncertainty for the market players, and that's the last thing the markets want.

Looking ahead, the BoJ's rate-hiking program might also be impacted if Japan goes through a change of leadership. So, that's a key reason why the USD/JPY is now moving sideways with no clear direction.

Rabobank forecasts that the USD/JPY is highly likely to be near 145.00 over a 3-month period. In addition, they are also accounting for a rate hike from the BoJ before the end of this year.

For now, it seems that the BoJ Governor is still following his script as he spoke about labor market, inflation, and other stuff. He also made it clear that more rate hikes will come if Japan's growth rate shows a big improvement.

But it is also a reality that the BoJ's program might get derailed under a different leadership. After all, the new leadership might have its own plans and will want the BoJ to follow those plans.

However, if the political uncertainty in Japan comes to an end, it would provide a big boost to the JPY. In that case, we can expect the USD/JPY to drop lower with a high chance of touching the 140.00 support.

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