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Why the yen is expected to exceed 100 this year

On Tuesday (March 13), the author stated that due to trade flows, investor positions, and differences in monetary policy, the yen is expected to break the 100 mark against the US dollar for the first time in 2016.

According to the data from the US Commodity Futures Trading Commission (CFTC), since January 9th, leveraged funds have been gradually reducing their bets on the yen.

However, as these funds still hold net short positions, the continued liquidation may lead to further appreciation of the yen.

Masashi Murata, a foreign exchange strategist at Brown Brothers Harriman (BBH), said: “The theme for 2018 is the risk that USD/JPY will face a break below the 100 mark.”

At 11:40 GMT, USD/JPY is reported at 106.50/52.