FX Strategy Special Note: Calling EUR/JPY Lower
* While we had been calling for a tactical correction higher in EUR, the probability of such a correction has fallen after aggressive rhetoric from ECB policy-makers.
* Meanwhile, the Japanese authorities have attempted to de-emphasise JPY weakness as part of their overall growth and inflation strategy.
* We believe that this diverging rhetoric will result in EUR beating JPY in a race to the bottom; we target 138.00 in EUR/JPY by year-end.
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