According to Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group, USD/JPY is expected to keep navigating within the 128.00-130.80 range in the near term.

Key Quotes

24-hour view: “We highlighted yesterday that ‘the pullback in USD has room to extend but is unlikely to break 128.00’. Our view was incorrect as USD rebounded strongly from 129.01 to 130.61 before dropping quickly. USD appears to have moved into a consolidation phase and it is likely to trade between 129.10 and 130.55 today.”

Next 1-3 weeks: “The current movement in USD is likely part of a consolidation phase and we expect USD to trade within a range of 128.00/130.80 for now.”