Danske Research discusses USD/JPY outlook and continues to see the pair trading around 107-110 range in the near-term.
"USD/JPY have been thrown back and forth by moves in global risk aversion, commodities and domestic fiscal response on the one side (stronger JPY), but also a very weak domestic economy and recently a global stabilization in risk sentiment (weaker JPY). Looking ahead, H2 2020 continues to be the time where USD/JPY could move slightly higher as we expect an economic rebound in Q4," Danske notes.
"We continue to expect 112 in 6M and 12M (unchanged), which still reflects our view of a strong USD. EUR/JPY has seen a sudden resurgence based on renewed EUR-optimism over May and June. Near term, we see USD/JPY as trading in 107-110 range with difficulties breaking through 110 as risk sentiment looks more uneven," Danske adds.