EUR/JPY to head north on Trumpflation, higher yields and equities – Danske Bank

Research Team at Danske Bank believes that the combination of rising inflation, rising bond yields and a more risk friendly business cycle outlook should support a higher EUR/JPY.

Key Quotes

“Historically, EUR/JPY has performed well in a scenario with a steepening of the US yield curve and rising US stock prices.”

“Fundamental factors stemming from a growing current account surplus are still likely to support the yen but also the euro. However, there is one key difference: the euro is significantly undervalued; the yen is not.”