Thursday, July 28, 2011

HSBC: USD/JPY may decline to 70 yen

Currency strategists at HSBC believe that no matter how develops the situation in the US, investors will benefit from buying yen.

In other words, the specialists expect Japanese currency to gain versus its American counterpart in both cases: if the market’s risk aversion keeps escalating and if the debt ceiling is finally lifted. In their view, it isn’t clear is the current environment negative only for the greenback or we see the general risk sentiment deterioration.

HSBC underlines that yen has added only 4.5% this year and is likely to start catching up better performing G10 currencies. According to the analysts, the pair USD/JPY may fall to 72 and probably to 70 yen.

daily usdjpy 14-36

 
Chart. Daily USD/JPY

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