FXstreet.com (San Francisco) - From Mansoor Mohi-uddin, Managing
Director and Head of Foreign Exchange Strategy at UBS: "In order to
surprise investors now, the BoJ should consider increasing its APP
to a much higher level than the government issues new bonds or to
ramp up its monthly pace of Rinban purchases as it did in 1995.
That would help sustain USDJPY towards the top end of its new 80-90
range - as step increases in quantitative easing would have more
credibility than the central bank's current policy of incrementally
increasing its asset purchases."
Mr. Mohi-uddin adds: "But if the currency pair is unable to stay in
a higher 85-90 range then eventually policymakers may have to
choose more radical measures including buying foreign bonds or
setting formal targets for the yen."
USD/JPY now exchanges at 87.75.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.