Japan: Excitement about easier monetary policy is weakening yen - SocGen

Kit Juckes, Research Analyst at Societe Generale, notes that the biggest mover overnight is the yen, weaker by 1% amid excitement about easier monetary policy.

Key Quotes

“Ben Bernanke is reported to have floated the idea of issuing perpetual debt, which at these yields would further blur the lines between slightly unconventional and downright radical policy.

Japanese asst flow data show the biggest weekly purchases of foreign bonds on record, at Y2.55trn, while the net outflow in bonds and equities was over Y3trn as foreigners sold Japanese equities. There’s considerable uncertainty about the policy outlook, but BOJ easing plus half-decent US data could give drag the yen a lot lower in the weeks to come.”