NZD/JPY: 80 area could be tested this week - Westpac

Buoyant risk sentiment globally has helped the NZD and hurt the safe-haven yen and the 80 area for NZD/JPY cross could be tested this week, according to Imre Speizer, Research Analyst at Westpac.

Key Quotes

“It’s a quiet week ahead in Japan though we do have the Q3 BSI on Wednesday and the BoJ next Friday. After the revised Q1 GDP disappointment, keep an eye on next week’s sentiment index. Hard to see too much from the BoJ though we continue to take umbrage with the ¥80tn JGB purchase target – especially as if we annualise the last 3 months, the BoJ bought ¥28tn.”

“3 months ahead: The BOJ’s defacto tapering of its asset purchases should continue to support the yen. In addition, bouts of Trump-disappointment will weigh on risk sentiment and boost the safe-haven yen. We see NZD/JPY returning to the sub80 area later this year.”