Japanese Yen Struggles as Experts Point to Economic Growth
The Japanese Yen has continued its decline against the US Dollar in recent trading sessions, with the USD/JPY pair returning above 159.00 after briefly dipping to lows near 158.00 last week.
Strategists at Societe Generale argue that a more sustainable recovery for the Yen is unlikely without an improvement in Japan's economic growth prospects.
The experts believe that rate differentials are not enough to support a significant Yen recovery, and instead point to the need for upgrades to Japanese forecasts as key to unlocking a durable rally.
According to Societe Generale, the current consensus of average growth this year and next of 0.75% is still significantly lower than pre-Gulf conflict levels, underscoring the need for a more convincing improvement in Japan's growth outlook.