USD/JPY: the macro gap
On the Macro Currency Strength Meter, the US Dollar scores +6 and the Japanese Yen scores +44 — a gap of 38 points in favour of the Japanese Yen. The widest divergence is in positioning, which favours the Japanese Yen. All else equal that gap is a fundamental tailwind for the Japanese Yen against the US Dollar — though markets may already have priced much of it in.
Strength gap
-38.0
Stronger side
JPY
Edge is
Holding steady
Scores
+6 vs +44
Factor by factor
Positive is stronger relative to the other majors, not in absolute terms. The gap column is USD minus JPY.
| Factor | USD | JPY | Gap |
|---|---|---|---|
| Interest Rates | +2 | +52 | -49.8 |
| Growth | +17 | +44 | -26.9 |
| Positioning | +15 | +82 | -67.2 |
| Risk Mood | -15 | -24 | +9.8 |
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