Halister News

(Bloomberg) -- USD/JPY to drop more than 3% if BOJ leaves policy unchanged and fails to provide forward guidance of easing after its meeting next week, according to 80% of respondents in a Citigroup global FX survey.

• If the BOJ doesn’t ease but gives “concrete guidance” for a move in Sept., USD/JPY may drop 1%-2%, according to 34% of the 170 respondents; another 15% see pair falling by more than 2% in this scenario
• 50% say USD/JPY would rise on forward guidance but no action
• The survey outcome “may tempt BOJ to delay, make promises, and decide in September whether to move or not,” Citigroup head of G-10 FX strategy Steven Englander writes in note received July 19
  • “The modest USD/JPY (and presumably equity market) consequences from dangling a six-week carrot in front of market may be hard to resist if no action is intended,” he says
• BOJ meets on July 28-29
• USD/JPY down 0.2% to 105.92