Investing.com – Further weakness in the Japanese yen appears likely, according to Bank of America Securities, citing its latest surveys of foreign exchange rates and interest rates.
At 10:25 EST (14:25 GMT), it was trading 0.2% higher at 155.83 yen, with the pair up just under 2% this week as yen weakness returns.
Notably, Japanese authorities spent nearly $60 billion in the previous week to pull the yen away from its 34-year low of 160.24 yen to the dollar.
Analysts at BOA Securities said the bank's survey showed a persistent bullish bias for the yen since mid-2022, until now.
As USDJPY broke new highs in April, investors turned to the biggest sell-off of the Japanese yen since 2022, and there are deep doubts about the effectiveness of Japan's intervention in the currency market.
The majority of fund managers surveyed expect USDJPY to retest the 160 yen level, with no one expecting a reversal to 150 yen, the bank said.
“Although we generally share these views, the change in the direction of the Japanese yen may warrant near-term caution regarding short positions,” the bank added.
