USD/JPY: in line with Q4 2017 target - Scotiabank

Analysts at Scotiabank noted that the JPY entered August at the upper end of its 2017 range following a modest 2.0% gain in July. 

Key Quotes:

"Its relative performance (vs. G10, G4 peers) has been disappointing despite a 6.0% YTD rally vs. the USD.

The shifting outlook for relative central bank policy remains a dominant theme as we note the ongoing JPY-supportive compression in longer-term interest rate differentials.

Positioning risk is elevated with extended bearish net CFTC positioning and gross shorts are at levels last seen in 2007. USD/JPY is in line with our Q4 2017 target at 110."