Friday, March 1, 2013
MONEY FOCUS: Deutsche Securities Revises Yen Outlook Down
TOKYO (NQN)--Deutsche Securities Inc. on Friday revised the yen-dollar rate forecast from 86 yen per dollar to 98 yen at the end of June and from 90 yen to 100 yen at the end of 2013.
The brokerage expects the Japanese currency to weaken further on the view that the Japanese government is firmly determined to improve its economy, with the yen assumed to trade to 110 per dollar at the end of 2014 and 115 at the end of 2015.
Taisuke Tanaka, chief currency strategist at the brokerage, touched on Prime Minister Shinzo Abe's monetary and economic policy.
"If the approach fails, Japan will lose a chance to rejuvenate its economy," Tanaka says.
Meanwhile, Tanaka added, if the yen falls below the assumed rates, negative effects, such as inflation, could occur. The currency's further depreciation would also work negatively for Japanese bonds.
Deutsche Securities also revised its euro-yen and euro-dollar forecasts. The euro is expected to trade to 123 yen at the end of June, up from the previous estimate of 112 yen. The brokerage expects the euro to trade to 1.25 dollars, down from the previous forecast 1.30 dollars.