Bank of Tokyo-Mitsubishi - "USD/JPY - bearish bias – (96.00-99.00)
The dollar selling pressure is likely to grow due to the US debt ceiling and federal budget negotiations that have shut down the US government this week. The USD/JPY rate may reach the recent lowest point of 95.81 set on 8th August. However, given the successful bid for Tokyo 2020 summer Olympic announced in September, and given the expectations surrounding ‘Abenomics’, Japan's inflation expectations are growing. These expectations have supported USD/JPY buying through much of this year, but have now been disrupted by uncertainties in the US. Assuming some progress on the US debt-ceiling issue is made, yen selling will resume again soon. However, for the week ahead that hope looks unrealistic."