NZD/JPY rebound could extend - Westpac

NZD/JPY’s recent rebound could extend to 79.45 - the Nov high, according to Imre Speizer, Research Analyst at Westpac.

Key Quotes

“Global risk appetite has been strong, hurting the safe haven yen. The next key event during the month ahead is the BoJ meeting on 23 Jan.”

“3 months ahead: A key issue to be considered in Q1 18 will be the current bond-purchase policy. Over the past 3 months, the BoJ’s balance sheet has increased by only ¥38tn - well below its ¥80tn target. Thus the next BoJ meeting could tweak the policy, reducing the balance sheet target to ¥40tn. The yen could thus perform well, taking NZD/JPY lower to 76.”