AUD to JPY at 80.60has fallen 3.5% below its 90-day average, range 80.40-85.29.
AUD/JPY – The Australian Dollar eased moderately against the Japanese Yen, finishing at 81.42 on Friday from 81.50 a week ago. Like the other currency pairs, the Aussie Battler had a roller coaster week against the Japanese Yen. AUD/JPY hit a high at 81.94 (last Friday) and saw a low at 80.01 (Monday). Risk appetite was the main driver of this cross-currency pair. Expect more of the same.
The souring of risk appetite almost always sees this currency pair push lower. The Australian Dollar normally strengthens when risk appetite is healthy while the opposite follows. As for the Yen, it’s the opposite. The Japanese currency will rise when risk appetite sours.
Australian dollar to Japanese Yen bank forecasts
AUD to JPY had gained 8 percent in the first quarter as commodity markets gain favour in 2021 with positive market sentiment associated with Joe Biden’s election win and vaccine roll-out news.
In the first weeks of May AUD/JPY had risen above ¥85, well past National Australia Bank’s prediction of ¥79 for the end of the first quarter 2021.
Aussie is benefiting from the Copper price surging above 9,000 for the first time in more than 10 years, on concerns about a global deficit of the metal and growth expectations.
USD/JPY – retreated from 7-day highs around 110.30 to 109.30 late last week. The decline in the US 10-year bond yield to 1.44%, March lows pulled the Dollar lower against the Yen. JPY Forecasts
Until the recent Fed Reserve pivot, the Australian dollar had benefited from the US dollar sell-off since late last year as investors moved away from the safe haven of the USD and into riskier assets. AUD Forecasts
Whether the Australian dollar will rise or drop in the future versus the yen is a difficult question and the answer really depends on many factors. The best way to consider the current AUD-JPY relative value is to check the change in the exchange over a range of periods to the present day. The below table does this for periods going back 10 years.
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