USD/JPY continued to trend up - Rabobank

USD/JPY continued to trend up as risk appetite returned and safe haven demand ebbed and if geopolitical tension remain under control, there is scope for the carry trade to continue guiding USD/JPY higher, according to analysts at Rabobank.

Key Quotes

“After all the BoJ is expected to confirm later this week that it remains committed to its enormous QQE programme while the Fed could provide guidance as to when its balance sheet reduction will commence.  That said, given the precedent that has been set this year it can be assumed that politics are likely to outdo the simple carry trade as an influence on both the USD and the JPY.  Newswires are suggesting that Abe may be prepared to call a snap election to take advantage of the bounce back of his popularity; the shock of having N. Korean missiles flying overhead has re-enforced demand for a strong leader.”