NZD/JPY higher near term – Westpac

NZD/JPY’s rally since Nov is getting stretched but could extend to 82.85, according to Imre Speizer, Research Analyst at Westpac.

Key Quotes

“Global risk appetite has been strong, hurting the safe-haven yen. The next key event during the month ahead is the BoJ meeting on 23 Jan.”

“3 months ahead: A key issue to be considered in Q1 18 will be the current bond-purchase policy. This week the BoJ made a modest reduction to its long maturity JGB purchase target, effectively allowing the yield curve to steepen slightly. The next BoJ meeting could tweak the policy further, reducing the annual balance sheet target to ¥40tn. This would be yen-supportive, helping NZD/JPY to fall to 76 during the quarter ahead.”