FXStreet (Guatemala) - Analysts at Bank of Tokyo Mitsubishi explained that USD/JPY has been losing upward momentum amidst diminishing expectations of a Fed rate hike.
Key Quotes:
"Risk reversals are signalling an increasing risk of a further move lower for USD/JPY."
"A strong September US non-farm payroll report Friday will likely offer some support for the US dollar although is unlikely to be seen as significant in determining whether the Fed will begin to hike rates this year."
"We continue to expect the BoJ to leave QQE unchanged at their upcoming meeting on October 6-7, although acknowledge that the risk of further easing has increased. Building expectations of further BoJ easing may begin to weigh on the yen in the week ahead."
"The weaker than expected industrial production report for August has reinforced concerns that Japan’s economy may have fallen into technical recession in Q3. The economic slowdown in China is increasing external risks to growth in Japan as well."
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