USD/JPY has the high from June 2015 at 125.86 in its crosshairs – MUFG

USD/JPY is trading at a fresh year to date high of 123.70. Economists at MUFG Bank expect the pair to hit the June 2015 peak at 125.86.

Little pushback against yen weakness by Japanese officials 

“We expect the sharp widening of yield spreads between the US and Japan to keep lifting USD/JPY closer towards the high from June 2015 at 125.86.”

“BoJ Governor Kuroda still views yen weakness as a positive for Japan’s economy although he did also note that FX stability is preferable perhaps an early indication that the recent fast pace of the yen weakness could garner greater concern if it continues in the coming weeks/month.”