Morgan Stanley is bullish on JPY after Brexit.

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Morgan Stanley kept its bullish outlook on JPY unchanged. “The UK’s vote to leave has helped USDJPY break below 100, fueling speculation of FX intervention by the MoF. However, Japan is on the US Treasury’s list of potential currency manipulators, so it is unlikely to intervene unless it gets approval from the G7. The G7 may agree only to volatility-reducing operations, so any USDJPY appreciation is likely to be temporary and USDJPY will probably continue its march lower due to real yield differentials, hedging flows and the ineffectiveness of conventional monetary and fiscal policy tools in weakening JPY.” written in the report.

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