AUSSIE-YEN: Westpac note that "the Japanese yen......>

AUSSIE-YEN: Westpac note that "the Japanese yen has been quite an unreliable

haven currency this year, which should help limit the downside risk on

traditional risk barometer AUD/JPY as risk appetite gyrates incoming weeks and

months. In terms of containing Covid-19, both Australia and Japan are

outperformers by global standards, although Australia probably has greater scope

for a reopening-driven growth rebound in H2 2020. This outlook reinforces the

RBA's tendency to lean to the optimistic side and should help stem the slide in

AUD's yield pickup. The RBA took a leaf out of the BoJ's book by adopting yield

curve control and after an initial flurry of purchases, it too hasn't needed to

buy aggressively to hit its target. But while the BoJ's JGB purchases remain

sluggish, it has ramped up its balance sheet expansion since March. So the

relative QE trend looks to be supportive of AUD/JPY. We are also more optimistic

about the resilience of iron ore prices, helping offset the damage to Australian

exports from the ongoing travel restrictions. Our baseline forecasts of 74 in

September and 76 by December suggest a preference to buy into dips caused by

swings in global risk appetite, ideally around 72.50."