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USDJPY call opciós vétel.

Japanese Finance Minister Noda warned overnight that he would closely watch foreign-exchange movements but declines to comment on whether Japan will intervene. He again warned that excessive currency moves are bad for the economy and a stronger JPY erodes corporate profits. The comments are clearly a step forward but we do not believe volatility or headline rates have moved towards worrying levels yet.

We think USDJPY will fall to the lower end of its recent 85-95 range and doubt the Ministry of Finance will authorise any direct intervention in the FX market. What may arrest the decline of USDJPY, however, is the Bank of Japan announcing new market measures, as it did in Q4 2009, when it held 3m tenders of yen liquidity. However, there is little sign of that happening in the near term, except for the introduction of a new lending scheme which has been well signaled in advance and is due to become operational later this month.