JP Morgan maintains a medium-term bearish bias on JPY.

"We think that higher energy prices amid heightened Middle East tensions would increase the downside pressure on JPY through various channels," JPM notes.

"Given that, we maintain our medium- to long-term bearish view on the JPY and keep our USD/JPY year-end target unchanged at 164. First, as Japan is highly dependent on imported energy, rising energy prices are likely to increase import costs and widen the trade deficit, and con- cerns over these developments could trigger JPY selling. Second, the recent rise in energy prices has lifted inflation concerns, pushing central banks toward a more hawkish stance and leading markets to price in further rate hikes, while expectations for BoJ rate hikes have not risen much," JPM adds.