Stronger-than-expected U.S. jobs growth figures on Friday brought the yen bears out to play, and after some tussling with the bulls, analysts say the yen will resume its downward trend this year.
“The U.S. Jobs numbers give a fresh push to the stronger dollar trend,” said Bank of America Merrill Lynch currency strategist Shusuke Yamada. “Not only are yen short positions at the lowest level since July 2014, but fresh buying of U.S. Treasury’s by Japanese institutional investors, as well as speculation over further easing by the Bank of Japan, will provoke more yen-selling.”
The U.S. economy added 257,000 jobs in January, Bureau of Labor Statistics data showed, above expectations of 234,000. The dollar surged after the data were released, breaking as high as 119.20 yen for the first time in a month. The pair was around 118.80 in late Asian trading on Monday.