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Oct 18 - 12:55 PM

USD/JPY: 5 Supporting Factors For Longs; Where To Target? - BofA

By eFXdata  —  Oct 18 - 10:45 AM

Bank of America Global Research maintains a bullish bias and a long exposure in USD/JPY, targeting a move towards 117.

 "We noted both fundamentals and technical were favoring a higher USD/JPY. We still see supportive factors: 1. Japanese mineral fuel imports tend to rise in the winter (Dec-Mar).. 2. The BoJ did not reduce its bond purchases when it announced the quarterly schedule for 4Q21 at end-September," BofA notes. 

"3. On the other hand, the Fed is expected to start tapering its bond purchases and the elevated level of inflation is spurring debates over the timing of the rate hike in the US rates market. 4. With policy divergence, foreign investors’ FX hedge ratio in Japanese equity investment could rise 5. Technicals remain supportive of USD/JPY over the medium term," BofA adds. 

Source:
BofA Global Research

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