JP Morgan AM: JPY breached lowest level vs. USD in three decades

JP Morgan AM: JPY breached lowest level vs. USD in three decades

6 mei 2024

Valuta Dollar Japanse Yen
Japans geld.jpg

A brief move above 160 last week marked the Japanese yen's weakest level against the US dollar since 1990.

In our view, there are two main drivers of yen depreciation year-to-date. The first has been stronger-than-expected US data, increasing the chance of 'higher for longer' US interest rates. The second is a Japanese central bank that seems keen to keep policy very accommodative.

While Japan’s Ministry of Finance (MoF) can intervene to prop up the yen, as it appears to have done last week, historically currency intervention in Asia has only managed to slow the pace of depreciation. Thus, to halt the yen’s decline, some combination of a more hawkish Bank of Japan, a more proactive MoF, or cooler US economic data will be needed.

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