As predicted on Friday by Economist Shayne Heffernan the USD/JPY peaked in afternoon trade in Asia and has reversed.

Currently the USD/JPY is looking to head towards 78 in the mid-term.

Last week the BoJ announced it will increase its asset purchasing programme by ¥10 trillion (£82 billion) to ¥65 trillion, while taking a firmer stance against the deflation of the past 15 years by setting an inflation target of 1% for the short term and less than 2% for the long term.

This move seen the USD/JPY run to over 79.5 however the long term impact of the BoJ policy may not be what they are looking for, in fact it may see the opposite happen.

The yen's relentless rise in the last five years has made it increasingly difficult for Japan to export its products, hurting Japanese exporters' earnings, however, what will happen to the yen in the long term, as the Bank of Japan has done this before, and it hasn't worked.

The run up looks like an over reaction that is set to correct this week.


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Shayne Heffernan

Shayne Heffernan oversees the management of funds for institutions and high net worth individuals.

Shayne Heffernan holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.