USD/JPY has resumed its march higher and is trading near 130 today. Economists at BBH continue to look for a test of the 2002 high near 135.15.

Downplaying FX intervention risks for now

“We continue to target the January 2002 high near 135.15. If that level breaks, the August 1998 high near 147.65 would come into view. 

“Japan markets will be closed until Friday for the Golden Week holidays. While speculators may try to take advantage of thin markets to push USD/JPY higher, our understanding is that the Bank of Japan maintains staffing during the Golden Week to monitor markets. That said, we continue to downplay FX intervention risks for now.”