Usdjpy Long Term Target

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Usdjpy Long Term Target

Usd/Jpy Long Term Target Set At 143.50 - Mufg

MUFG has issued a new forecast for USD/JPY in which they see the pair heading towards the 143.50 level. The overall forecast is bearish for the US Dollar.

It seems that MUFG is also among the majority that believes in a bullish Japanese Yen. Only a few other investment banks are forecasting the US Dollar to gain value in the coming quarters.

More Rate Cuts Are Coming

MUFG believes that the US labour market will only deteriorate further, while Powell also talked about how they need to change the policy stance.

That's why the chances of a rate cut have now reached new highs, and even MUFG believes that more rate cuts are now on the cards.

As for the Bank of Japan, MUFG added that it will likely hike the interest rate. So the overall situation is that the US Central Bank is going to cut the rates, while the BoJ will go with a rate hike.

natural reaction to all of this would be the narrowing of the yield spreads. So, it makes sense for the US Dollar to lose its support against the Japanese Yen.

Another important thing to keep an eye on will be the global risk conditions. Even that angle will support the Japanese Yen, especially if the equity markets move lower.

And if the risk trades go through liquidation, it will also be negative for the USD/JPY pair. Overall, MUFG believes that we will not see any big gains in the Japanese Yen, but it will still be positive for the JPY.

If we look around, a lot of other investment banks and analysts are also bearish on the US Dollar. The forecasts for the EUR/USD are also bullish, which means everyone is now forecasting more selling in the greenback.

If we look at the GBP/USD, even that pair is poised to gain upside in the coming months as the yield spreads will change the dynamics.

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