Currencies
Yen Forecasters Chart Path Past 140 as Global Rate Tracks Emerge
- Macquarie and StanChart among those forecasting stronger yen
- Swaps indicate certainty that Fed will cut rates this month
This article is for subscribers only.
Currency strategists have had a radical rethink on the trajectory of the yen in the wake of the Bank of Japan’s interest rate hike in July and the Federal Reserve’s recent signaling of looming cuts to US borrowing costs.
Prior to the BOJ’s July 31 decision, many strategists still warned of further weakness in the beleaguered yen, a currency that had already slumped about 12% against the dollar in the first half of the year. Bank of America, ATFX Global Markets and Royal Bank of Canada all cautioned as recently as June that Japan’s intervention in the market may not stop the slide, leaving the yen vulnerable to another run past 160 to the greenback.