Eyes will be on the yen yet again today in Asia.
Adam had a great update here on an analyst note:
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This now from JP Morgan comes via eFX.
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- "Household/corporate FX deposits at Japan banks are rising sharply. This could catalyze further JPY depreciation over the medium term. FX deposits usually follow the yen's trajectory: households tend to buy foreign currency when the yen is strong, and sell when it is weak. But there has been a somewhat unusual decoupling in this trend over the past couple of months, with FX deposit growth soaring to cycle highs even as the JPY NEER has tracked multi-year lows," JPM notes.
- "We do not think this suggests a wholesale loss in confidence in the currency. But to the degree that foreign currency deposit growth continues to rise, this suggests an additional idiosyncratic headwind for the yen," JPM adds.
