JPYINR Intraday Outlook : 21.3.2017

JPYINR Intraday Outlook : 21.3.2017

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USD-JPY has settled in the mid-to-lower 113s after logging a 17-day low at 112.90 Friday, in the wake of the post-Fed announcement dollar selloff. The yen has been more mixed versus other currencies, particularly in the case for EUR-JPY, which has surged on the back of the Dutch election and after ECB member Nowotny said that the deposit rate may be hiked before the repo rate (comments not designed to signal the timing of a policy timing, but nonetheless taken as a bullish euro cue by markets). EUR-JPY logged a three-session peak at 112.25. The fundamental case for USD-JPY is bullish, with the BoJ's no change policy decision this week, accompanied by a pledge from governor Kuroda to maintain "powerful monetary easing" at his press conference, standing in stark contrast to the tightening course of the Fed, even if its communication this week wasn't as hawkish as markets had anticipated. We look for a more sustained rebound in USD-JPY, targeting 115.00 initially. Japan is on holiday today for Vernal Equinox.