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FX BANK FORECAST · COVERAGE
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Aggregated year-end forecasts, scenario shifts, and curated analyst notes from 30 institutional desks. No promotion.
FX BANK FORECAST · COVERAGE
Aggregated year-end forecasts, scenario shifts, and curated analyst notes from 30 institutional desks. No promotion.
The desk believes that Bank of America's recent revision of its USD/JPY forecast points to a strengthening yen, expecting it to trade at 147.0000 by the end of 2026. This view corroborates the notion that the fading gap between Japan's and the U.S.'s interest rates may lead to renewed yen appreciation, a sentiment echoed in various recent analyses. Per the full note source, the consensus targets for USD/JPY range from 149.0000 to 160.0000 for March 2026, highlighting persistent uncertainties and diverse outlooks among market participants.
The desk frames this as a potential turning point for the yen, which has faced significant headwinds but might benefit from policy shifts in Japan. For instance, Bank of America's adjustment aligns with broader expectations of tapering from the Bank of Japan as inflation pressures build, which could stabilize the yen.
Supporting this view, Japan's central bank has sustained a loose monetary policy for a prolonged period, but recent economic indicators may prompt a reconsideration before the end of 2026. Bank of America's updated target mirrors the cautious optimism evident across some institutions, leaning toward a stronger yen trajectory.
Our median consensus target for USD/JPY is 154.5000, with a range from 149.0000 to 160.0000. Key targets from notable firms looking ahead to December 2026 include: - bofa: 147.0000 - goldman: 148.0000 - morganstanley: 140.0000
The bofa forecast sits slightly lower than the consensus, indicating a divergence in outlook relative to others who see potential strength in the yen.
How firms align with this view
Contrary positioning
Key takeaways
Market implications
Traders should monitor the USD/JPY at the current level of 157.0000 for potential breakpoints, particularly as the forecasted target approaches. Watch for updates from the Bank of Japan that could influence expectations around interest rate shifts.
Risks to this view
Should inflationary pressures subside or economic growth falter in Japan, it could delay interest rate adjustments, weakening the yen. Additionally, a sudden turnaround in U.S. monetary policy could also place downward pressure on the yen against the dollar.
| Firm | Stance | YE 2027 |
|---|---|---|
Goldman Sachs | Bearish | 165.00 |
UOB | Bearish | 163.00 |
Citi | Bearish | 163.00 |
All 23 desk targets for USD/JPY
How we cover this story
USD/JPY trades at 161.71, some 8.53% above the 23-firm median Dec-26 target of 149.0, with a 25-point dispersion signalling deep disagreement on the BoJ path.
USD/JPY trades 8.53% above the 23-firm Dec-2026 consensus of 149.0, with a 25-point dispersion that reflects sharply divergent BoJ and US rates assumptions.
USD/JPY trades at 161.71, 8.53% above the 23-firm median Dec-26 target of 149.0, with a 25-point dispersion that reflects deep disagreement on the BoJ-Fed rate-spread path.
23 investment banks see USD/JPY at 150.74 by Dec 2026
View the live USD/JPY forecastJPM |
UBS |
BofA |
CIBC |