FXStreet (Delhi) – Chris Turner, Global Head of Strategy at ING, suggests that the return of Japan’s current account to a large surplus is a timely reminder of Japan’s large Net International Investment Position.
Key Quotes
“Decades of current account surpluses show Japan, Switzerland and Norway to have the largest claims on foreign assets. Those on the wrong side of the ledger remain Australasia, the US and most recently the UK following the recent switch to net FDI outflows in the UK.”
“If we are correct with our call for a more challenging Late Cycle investment environment, expect the JPY to enjoy many more days similar to those seen in the middle of August when it looked like the PBOC was de-valuing the CNY.”
“Expect the JPY to perform well on the crosses in 2016, with our favoured trades being short AUD/JPY and also short CNH/JPY. The latter looks largely an avenue to express a negative trade on USD/JPY, but could also surprise were the PBOC to accede to a strong USD environment and let USD/CNH rise.”
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