Credit Agricole CIB Research discusses USD/JPY outlook into year-end.

"We cannot possibly know how the GPIF will change its asset allocations. The pension fund will be reporting its Q2 performance in early November and could announce any reallocations then. Looking across our potential reallocations, USD/JPY’s short-term fair value ranges from about 140-150 with a median of 148. If we were forced to choose the most likely scenarios, which we need to do to forecast, we would focus on allocations towards domestic bonds between 31-35% in combination with no change to a modest rise in the allocation to domestic equities of 31%," CACIB notes.

"We doubt the GPIF would want to allocate much more than 60% of its AUM to domestic assets. So, we expect USD/JPY to track lower to 150 by end-2026 given this would lead to a fall in USD/JPY’s short-term fair value to between 148-150," CACIB adds.