UOB Stands Firm on Bearish Yen Outlook Amid Higher Trading Range

United Overseas Bank (UOB) Group's FX strategists are maintaining their bearish bias for the Japanese Yen against the US Dollar, but note that the pair is likely to trade within a higher range in the near term.

The analysts identified a 'higher range' as the likely trading zone, suggesting that any downside is limited for now. However, they pointed out that if the pair breaks below the lower end of this range, it could signal a shift to a more pronounced downtrend for the Yen.

The bearish bias on the Yen persists due to the divergence in monetary policy between the Bank of Japan (BoJ) and the Federal Reserve. While the Fed has maintained a relatively hawkish stance, the BoJ has continued its ultra-loose monetary policy, keeping yields low and making the Yen less attractive to investors.