Mizuho Play Down Prospect Of Imminent USD/JPY Intervention

Mizuho note that "as long as the (USD/JPY) decline remains orderly, we do not see any prospect of actual intervention in the near term. Currency officials will be watching the US election closely. Trump's views on trade and currency intervention are non-standard. A change in administration would most likely see a reversion to the status quo ante in terms of views on trade and make intervention less of an issue, assuming it is justified by disorderly market developments and/or being clearly over-valued. Japan's low inflation rate leaves it among the high yielders when looking at real rates. In contrast the US has relatively elevated inflation and the near-zero policy rate is ubiquitous leaving the US with relatively low real interest rates. This is another prop for the US dollar that has fallen by the wayside in recent months and adds to pressure on the yen to appreciate."