Former BOJ Board Member Shirai Says Yen Could Hit ¥165

BOJ Rate Hikes Are Not A Magic Bullet To Reverse Yen Weakness

Source: https://fred.stlouisfed.org/series/DGS2 and http://www.mof.go.jp/english/jgbs/reference/interest_rate/index.htm

Key Points:

• The yen could go to ¥165 says former BOJ Policy Board member Sayuri Shirai if the Fed raises US rates again, but it could go there even before such a hike

• Yen reaches 162.6 as traders seem less fearful of intervention

• Some say MOF recognizes that intervention won’t work and only the BOJ raising interest rates can work

• But raising Japanese rates is no magic bullet to reverse yen weakness

• Some analysts, including former BOJ Governor Kuroda, say the yen is bound to strengthen because it is woefully undervalued, but that’s not the case in my view

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