USD/JPY: Yen outperforming on European banking sector concerns and Kuroda - Scotiabank

Analysts at Scotiabank explained that the JPY is outperforming, strengthening in an environment of elevated risk aversion with notable weakness across global equity indices with a renewed focus on banking sector concerns in Europe.

Key Quotes:

JPY has strengthened in response to fresh public commentary from BoJ Gov. Kuroda, highlighting the recent shift toward policy flexibility along with an uncharacteristically tight focus on FX and the desire for ‘stability’. We continue to highlight the high bar to intervention, given Japan’s G7 membership. JPY is vulnerable to knee-jerk haven-driven strength in periods of risk aversion. Remain bullish (bearish USD/JPY)."