Morgan Stanley turns bearish on the yen as the impact of intervention gradually fades.

Morgan Stanley's foreign exchange strategists have shifted to a bearish stance on the yen. They believe that, with evidence showing that the measures taken by Japanese and U.S. authorities to support the yen's exchange rate have only a temporary effect, the yen will gradually weaken. The authorities' joint efforts to support the yen only provided a short-lived boost to yen demand and did not reverse its long-term downtrend. Therefore, the strategists maintain a neutral position while adopting a bearish inclination. "Unless there is a renewed joint intervention in the currency market, we expect USD/JPY to gradually rise," David Adams, Andrew Watrous, and Molly Nickolin wrote on Friday.