Australian Dollar Forecast

post: JAPANESE YEN WEAKENS AGAINST DOLLAR, HITS 7-MONTH LOW AT 159USD/JPY bulls turn cautious near 159.00, highest since April amid intervention fears USD/JPY remains supported near its highest level since April touched earlier this Friday. The BoJ rate-hike uncertainty and mixed National CPI from Japan undermine the JPY. September Fed rate cut bets cap gains for the USD and the pair amid intervention fears. The USD/JPY pair oscillates in a narrow range during the Asian session on Friday and consolidates its recent gains to the 159.00 neighborhood, or the highest level since late April touched the last hour. The fundamental backdrop supports prospects for a further near-term appreciating move for the currency pair, though intervention fears might cap the upside. The Japanese Yen (JPY) continues to be undermined by the disappointment led by the Bank of Japan's (BoJ) lack of commitment to hiking interest rates in the near term. FurthermoreJapan chief cabinet secretary Hayashi says stable FX levels are desirable Japan chief cabinet secretary Hayashi says stable FX levels are desirable. Verbal intervention has cranked up a gear today. Hayashi now: • Addition of Japan to the US currency monitoring list does not mean that Japan's foreign exchange policy is a problem • Stable forex levels are desirable. • Important that forex rates reflect fundamentals. • Will continue to closely monitor moves in forex market. Despite all this USD/JPY is higher, above 159.10 as I update. Also from Japan were the data for inflation, which is sitting around levels that the Bank of Japan could accept as an argument to hike rates again. They have told us time and again that they'd like to see demand driven inflation, but with wages rising they'll argue this is likely on the way.Japan finance minister Suzuki - excessive, disorderly fx moves could hurt economies Suzuki weighs in with verbal support for the yen too. Japan finance minister Suzuki: To visit Seoul on June 25 to meet with South Korean counterpart. Will communicate closely with US, other countries on FX based on G7 agreement that excessive, disorderly fx moves could hurt economies. Doesn't think US sees Japan's fx policy as problematic.