Bank of America is optimistic about AUD/JPY, based on oil prices and the weak outlook for the Japanese yen.

LootboxPhobia · 2026-04-08T10:12:27+00:00

Bank of America holds an optimistic outlook on cross-Japanese yen currency pairs, with a preference for AUD/JPY, mainly due to high oil prices and divergence in central bank policies. The yen is expected to weaken against commodity currencies due to multiple factors, and the reduced pressure on the US dollar will lessen the risk of foreign exchange interventions.

LootboxPhobia

2026-04-08 10:12:27

Abstract generation in progress

Investing.com — Bank of America maintains a positive outlook on cross yen currency pairs, favoring the AUD/JPY exchange rate. The rationale includes multiple factors such as elevated oil prices and policy divergence at central banks.

According to a report dated April 1, 2026, the company’s commodities team projects that, assuming the conflict involving Iran ends in April, the 2026 average Brent crude oil price will be $92 per barrel. Even if tensions around Iran ease, normalization in oil prices may take time.

Bank of America expects the yen to weaken versus commodity currencies for a variety of reasons. The impact of rising oil prices on foreign-exchange supply and demand dynamics has not yet shown up and still lies ahead. Falling volatility is often bad for the yen, but good for high-beta currencies.

The company noted that as pressure for the U.S. dollar to appreciate eases, both the necessity and the risks of FX intervention decline. As overseas central banks shift toward a hawkish stance, uncertainty remains about the outlook for Bank of Japan rate hikes.

Bank of America said that an easing of tensions could reverse the broad strength of the U.S. dollar.

This article was translated with the assistance of artificial intelligence. For more information, please see our Terms of Use.

View Original

This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.