Rabobank - "While we expect any pullbacks in the JPY to be short-lived in the near-term, we have severe doubts as to the ability of the BoJ to be successful in creating inflation in the coming months.  Since the BoJ announced its 1% inflation target in February, Japan has slipped back into recession and deflation has reasserted itself.  Japan is not the only country exhibiting gloomy economic fundamentals.  The Eurozone is also in recession and there is speculation that the UK could be headed for triple dip. (...) The weak economic outlook appears to be at odds with investors’ desire to move into higher yielding assets but it is being fed by the present of cheap money from central banks. This year a discussion has broken out as to when the Federal Reserve will end its asset purchases plan. Despite the present of a number of hawks on the FOMC, the Fed has committed itself to generous liquidity provision until the US unemployment rate falls to 6.5%.  The implication of generous central bank policy is that the markets will continue to be shielded from gloomy economy reality and in this environment the yen is set to remain on the back foot.  In the absence of more hawkish sentiment from central banks, we would look to sell the yen on any rallies.  Given our weak USD outlook we expect EUR/JPY to have more upside potential than USD/JPY.  Our medium-term target lies at EUR/JPY122."