Bloomberg Surveillance Dollar-Yen in Focus
7 snips
Jan 15, 2026 
Dominic Konstam, Head of Macro Strategy at Mizuho Americas, discusses how AI-driven productivity could lead to lower inflation and forecasts U.S. rate cuts in 2026. He also explores the implications of fiscal policy on central bank independence and the potential need for basic income due to AI inequality. Sree Kochugovindan, Senior Research Economist at Aberdeen Investments, analyzes Japan's yen depreciation ahead of elections and the risks of sharp yen movements on global markets, emphasizing the broader effects on carry trades.
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AI Will Push Structural Disinflation
- Dominic Konstam sees AI driving structural disinflation beyond 2026 and easing pressure on policy.
- He expects the Fed to look through a temporary inflation pickup and keep rates lower for longer.
Stimulus Is Catching Up To Tariff Tightening
- Konstam frames recent stimulus as restoring demand lost to earlier tariff-driven tightening.
- He argues this sequencing helps avoid recession but won't drive a big labor-driven acceleration.
Dollar Weakness May Resume
- The dollar weakened in 2025 but less than it could have because the Fed remained relatively restrictive.
- Konstam expects renewed dollar weakness in 2026 if the U.S. moves toward rate cuts while other central banks diverge.