Re: nincs cím

UBS

JPY: CPI figures in line National CPI for February came in as expected at -1.1% y/y (prev. -1.3%). Although this was the 13th consecutive monthly decline, the pace at which consumer prices are falling is clearly slowing. However, Finance Minister Kan was quick to call for greater efforts to escape deflation and MoF policy now appears to be aimed at extracting the economy from deflation before year-end. We bought USDJPY at 92.45 as a trade recommendation. We target a rise to 97.00 and have put our stop at 90.95. Several factors speak in favour of this trade: (1) the financial year is about to end in Japan so investors will start to buy foreign assets again from April, (2) the BoJ is likely to come under more pressure to ease further as the government faces Upper House elections in July, (3) the recent USDJPY rally has broken a 3-year downtrend but investors don't seem to be positioned for a sharp move higher, (4) US yields are rising, (5) the Fed is due to stop buying MBS next week, and (6) next Friday's US payrolls are likely to be strong.