28 Jun 2013
Flash: AUD/JPY set to recover towards 94.00 - Westpac
FXstreet.com (Barcelona) - The substantial depreciation in the AUD/JPY exchange rate from April highs to June lows seems more than ample to suggest that a recovery is underway, says Sean Callow, FX Strategist at Westpac.
According to the Westpac Strategist, "While Australia's domestic data outlook and RBA bias don't argue for a steep rally, our base case is for a recovery to the 94 region multi-day/week as specs trim AUD shorts." A recovery past the 94.00 handle, however, should require "a return of substantial Japanese demand for Australian bonds rather than the recent trend of Japanese investors selling into yen crosses" Callow added..
According to the Westpac Strategist, "While Australia's domestic data outlook and RBA bias don't argue for a steep rally, our base case is for a recovery to the 94 region multi-day/week as specs trim AUD shorts." A recovery past the 94.00 handle, however, should require "a return of substantial Japanese demand for Australian bonds rather than the recent trend of Japanese investors selling into yen crosses" Callow added..