Bank opens long position at 111.20, targeting 114.50, citing fundamentals over intervention as key yen driver.
MUFG initiated a long AUD/JPY trade at 111.20, setting a target of 114.50 and a stop-loss at 109.20. The move reflects the bank’s view that yen strength from joint US-Japan intervention will be short-lived without fundamental support.
Historical precedents, including 1995, 1998, and 2011, show USD/JPY often revisited or breached intervention levels before fundamentals dictated direction. MUFG argues rate differentials or growth data, not intervention, will ultimately drive yen trends.
The bank also cited weaker-than-expected July US payrolls as reinforcing a softening fundamental backdrop, though it expects any USD/JPY downside to unfold gradually rather than sharply.