Danske Research discusses USD/JPY outlook and now targets the pair at 129 in 3-months, 127 in 6-months, and 122 in 12-months.

"Higher long US yields have been the most important driver of USD/JPY for a while now. The increasing divergence between US treasury yields and JGBs has kept increasing as the BoJ has defended its yield curve control. In the short run, the global pressure for higher yields and the global energy crunch will keep weighing on JPY," Danske notes. 

"Looking further ahead, we do expect the pressure on JPY will wear off when inflation shows signs of peaking and we see Tokyo capping the upside on USD/JPY," Danske adds.