Wednesday, August 3, 2011

Barclays Capital: Japan will follow SNB's example

Analysts at Barclays Capital believe that franc may be no longer regarded as the safe haven after the Swiss National Bank eased monetary policy to keep franc from further appreciation, so investors will likely turn to Japanese yen. As a result, the pressure on Japan’s monetary authorities will strengthen. According to BarCap, Japan must act quickly to stem yen’s advance if it means to do so.

Strategists at RBS note that the Bank of Japan will seriously consider the option of easing monetary policy. The economists underline that Japan and Switzerland are facing similar challenges with regard to the strength of their currencies used as refuges from the European and US debt problems. In their view, it would be easier for Japanese officials to decide on intervention than it was for SNB which lost billions in 2010 trying to stem franc.

RBS expects Japan's MOF to intervene after US non-farm payrolls data is released on Friday.

daily usdjpy 15-07

–°hart. Daily USD/JPY

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