With the Federal Reserve prepared to hike interest rates by 50 bps at upcoming meetings, economists at Westpac expect the USD/JPY pair to try another move above the 125 level.

Hard to imagine that we have seen the highs for USD/JPY

“With the Fed set to execute a series of 50bp moves, and commence an aggressive QT program in May, it’s hard to imagine that we have seen the highs for USD/JPY.”

“We await clearer signs that a top is in place and tend to think that we will see a final move above 125 for USD/JPY and 138 for EUR/JPY before starting to think about selling.”