BOJ governor nomination to drive JPY - Nomura

"Who will be the next BOJ governor? We think this will be an important risk factor for JPY trading over the next six months," notes Nomura Global Market Research Team.

Key quotes:

"While it is too early to shortlist the candidates, especially ahead of the impending snap election, we see three potential scenarios:"

"1) PM Abe loses his status to appoint the next governor, 2) PM Abe maintains the status quo, and 3) PM Abe embarks on further economic policy experiments."

"We believe the first scenario will be the most JPY positive, while the third scenario will be the most JPY negative. Although further economic policy experiments are not our central case, market expectations for a helicopter money-type policy mix will likely help to revive a weakening JPY."