FX168 Credit Suisse said on Saturday (June 5) that the US dollar/JPY broke the key resistance level by 125, which corresponds to the widening of the US/Japan interest rate spread. Many observers believe that from a valuation perspective, the yen is no longer expensive.
(capital outflow and US/Japan 2-year Treasury bond yield Image source: Credit Suisse)
The bank also said, but we believe that Japan's monetary policy is unlikely to complete a change in months, while the Nikkei index continues to rise, and the weak yen is expected to provide more stimulus.
The bank pointed out, "We believe that the continued rise of the US/Japan is based on the following two major support factors: 1) Japan's domestic investment capital continues to flow out; 2) The rising US Treasury yield helps the US dollar strengthen."
The bank also pointed out, "Based on our above views, we raised the target price of US/JPY in the next three months from 122 to 128, and the target price of US/JPY in the next 12 months from 127 to 130."
The bank said, "We missed the latest wave of US/JPY in the past, and planned to fall to 123.00 to buy at a low price."
