USD/JPY: Topside To Be Held To 103 Next Week On Seasonal JPY Flows – BTMU

USD/JPY – NEUTRAL BIAS – (99.50-103.00)

Seasonal JPY repatriation flows will likely pick up in August, strengthening the yen. USD/JPY topside could be held to 103 next week, with a lower bound below 100 because of weak JPY selling close to the summer vacation period.

Real flows are now causing JPY to strengthen, and we expect data due August 8 showing a June current account surplus to reiterate this. The new Cabinet line-up, announced yesterday, has until mid-September when the Diet reconvenes to hammer out a FY16 stimulus package. Many investors are still watching for signs of real policy efforts under Abenomics

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