Yen and JGBs Short-Term vs Long Term
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I have read some articles arguing that the recent move in the Japanese Yen is overdone. However, considering the short-term without regard to the long-term context is naïve and potentially dangerous. Although I do not have significant proof, I believe long-term mean reversion can completely dominate short-term mean reversion hopes. Just to provide some longer-term context, I thought I would offer some graphical aids.
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| From TimelyPortfolio |
In my mind, the Yen selloff is only in its infancy. For the move to truly engage, I think we need Japanese Government Bond (JGB) yields to move higher also, and if it does we are in a different paradigm than the last 20 years. But, what do I know?
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