EUR rise expected by Japanese investors - Nomura

Analysts at Nomura explained that the more Japanese bond investors expect EUR/JPY to appreciate over the next six months, according to the Nikkei Quick survey. 

Key Quotes:

"The survey was conducted from 25 to 27 April, after the first round of the French Presidential election, which showed a low possibility of a victory for an anti-establishment candidate.

47% of bond investors expect EUR/JPY to appreciate, while 30% expect it to depreciate over the next six months.

The FY2017 investment plans of major lifers suggest a relatively cautious EUR/JPY forecast.

However, as the tail risk from French politics has diminished, Japanese investors’ views on EUR are likely to become more positive. Japanese bond investors expect major euro area 10yr yields to rise over the next six months, while their views on French 10yr bond yields are less significant. 

High expectations for higher euro area yields are unsurprising to us, as ECB normalisation is likely approaching."