Goldman Sachs: Yen Could Fall to 165 per Dollar Within a Year
N.R. Finch
Goldman Sachs analyst Tomohiro Ota forecasts the yen will weaken to 165 per dollar over the next year, driven by the BOJ's slow rate-hike pace and a persistent yield gap — a direct headwind for anyone holding yen-denominated assets.
What exactly is Goldman forecasting?
Analyst Tomohiro Ota sets a clear target: the yen hits 165 per dollar within twelve months.
This means → Goldman sees more downside ahead, not a bottom forming at current levels.
In plain terms = Goldman is telling the market: don't rush to buy the dip in yen.
What did the BOJ do — and not do?
The Bank of Japan held rates unchanged this meeting. Ota calls the decision unsurprising — a hike came just last month, so standing pat was widely expected.
Yet some investors worry the hiking pace is too slow, risking persistently elevated inflation.
This reflects a dilemma: hike too fast and the economy buckles; hike too slowly and prices keep climbing — the BOJ is walking a tightrope.
Why does the yen keep falling?
The core variable is the yield gap: Japanese rates sit far below those in the U.S. and other major economies, so capital naturally flows where returns are higher.
This means → as long as the BOJ hikes more slowly than its peers, the yen stays under pressure — this is structural, not a short-term blip.
Whether Goldman's call plays out hinges on one thing: how clearly the BOJ signals its next rate-hike timeline.
Content is for reference only, not financial advice.