Morgan Stanley Sees Yen Decline to 163 by Late July 2026

Morgan Stanley is taking a bet against the yen, predicting it will decline to around 163 per US dollar by late July 2026.

The bank's strategists argue that the yen's recent rally was driven by speculation and carry trade unwinding, rather than any fundamental shift in its economic backdrop.

Morgan Stanley's forecast implies a roughly 6% decline in the yen from current levels, which are around 154 per US dollar.

The bank recommends clients go long on the dollar-yen pair with a stop-loss set at 150, indicating a risk calculus that assumes the yen rally won't last.