Tag Archive: $JPY

Risk of 50 bp cut by the Fed Tomorrow Keeps the Greenback on the Defensive

2024-09-17

by

2024-09-17

With heightened expectations of a 50 bp cut by the Federal Reserve tomorrow, the dollar has not gotten a reprieve and is softer against nearly all the currencies. Japan's long holiday weekend ended, and the greenback has held above JPY140 today.

Read More »

Little Discussion about the US Budget Deficit in the Debate, But Falling Yields Drag the Greenback Lower

2024-09-11

by

2024-09-11

Overview: The US 10-year yield is lower for the eighth consecutive session. The yield was near 3.90% at the end of August. It is now flirting with 3.60%. The two-year yield has fallen 35 bp since the end last month to about 3.55%. Although Vice-President Harris was seen winning last night's debate, it is not clear if it was a more important driver than the continued decline in US rates, despite the budget deficit not the discussed much in the...

Read More »

Fragile Turn Around Tuesday

2024-08-06

by

2024-08-06

Calmer markets are prevailing today, but an unease remains, and market moves continue to be sharp even if less dramatic. Still, it is in these somewhat less volatile conditions that the US dollar is doing better. It is firmer against all the G10 currencies today.

Read More »

Market Boosts Odds of a BOE Rate Cut this Week

2024-07-29

by

2024-07-29

Overview: The US dollar is mostly firmer today ahead of what promises to be an eventful week. Sterling is bearing the brunt today, off a little less than half-of-a-cent as expectations creep up of a rate cut this week and Chancellor of the Exchequer Reeves plays up the poor state of public finances left by the Conservative government. Sterling (and the euro's) five- and 20-day moving averages have crossed. The yen is mostly within the pre-weekend...

Read More »

Yen’s Surge Continues, while PBOC Surprises with Another Rate Cut, and US 2-30 Year Yield Curve Ends Inversion

2024-07-25

by

2024-07-25

Overview: The capital markets are in flux. The powerful short-covering rally of the yen and unwinding of carry trades continues. For the second time this week, the PBOC has surprised by cutting interest rates. The dramatic sell-off of equities continues. The unexpected contraction of South Korea's Q2 GSP (-0.2%) is seen as confirmation of broader economic weakness Speculation of a more aggressive Federal Reserve is gaining ground. It is not that...

Read More »

Euro Trades Quietly Ahead of ECB Meeting

2024-07-18

by

2024-07-18

Jury duty assignment prevents a more comprehensive note, but here is a snapshot. Overview: The US dollar enjoys a firmer bias today, in mostly quiet turnover in narrow ranges. The Australian dollar is a noted exception, and the better than expected jobs growth may have lent it some resilience today. The greenback initially was sold to almost JPY155.35, a new low (since June 7) before recovering to nearly JPY156.60 in Europe. The UK's employment...

Read More »

Market Takes JPY Lower Despite Intervention Speculation, While Sterling Shines

2024-07-12

by

2024-07-12

Overview: The dollar is mostly consolidating yesterday's CPI-inspired decline. The main features include the market bidding the US dollar back above JPY159 despite more speculation that the BOJ did in fact intervene yesterday and checked on the euro-yen cross in the local session today, and unexpectedly soft Swedish inflation, which the swaps market says could spur three rate cuts here in second half. A record trade surplus and strong aggregate...

Read More »

No Turn Around Tuesday as Greenback Remains Firm

2024-07-02

by

2024-07-02

Taking the next few days off.  Will be back with week ahead commentary on  July 6.  Overview: The sharp jump in US long-term interest rates has helped lift the greenback in recent sessions and it remains firm against most of the G10 currencies today. The Canadian dollar is the best performer, and it is nearly flat. The intraday momentum indicators warn that after a mostly consolidative Asia Pacific and European morning, the greenback may probe...

Read More »

Greenback Consolidates Last Week’s Surge

2024-03-25

by

2024-03-25

Overview: After surging at the end of last week, the dollar is consolidating today. Stepped up verbal intervention by Japan's currency chief Kanda and a slightly weaker dollar fix by the PBOC seemed to take the wind from the dollar sails. Except for the Swiss franc and Swedish krona, the G10 currencies are showing a slightly firmer tone. Emerging market currencies are mixed, with central European currencies leading the advancers. The Taiwanese...

Read More »

Powerful Short Squeeze Continues to Lift the Yen

2023-07-11

by

2023-07-11

Overview: The greenback remains under pressure. The yen's short squeeze continues, and strong wage growth has helped lift sterling to new highs since last April. Among the G10 currencies, only the Australian and New Zealand dollars are unable to sustain gains through the European morning. Emerging market currencies are also advancing, with a couple of exceptions, including the Turkish lira despite reports on foreign equity inflows. The weaker...

Read More »

Yen: Short Overview

2023-04-24

by

2023-04-24

The yen is off about 1% this month to bring the year-to-date decline to about 2.4%. It fell by 12.2% in 2022 and 10.3% in 2021. The yen rallied against the dollar for the five preceding years. Over that five-year period the dollar fell from around JPY124 to JPY99, but it was all done in H1 16, and after a rally at the end of 2016 and very early 2017 (to about JPY118.65), the dollar ground down around JPY101. This year’s dollar low was set in...

Read More »

Japan Surprises

2022-12-20

by

2022-12-20

The Bank of Japan surprised everyone may lifting the 10-year yield curve cap to 0.50% from 0.25%.The BOJ also said it would increase its bond purchases to JPY9 trillion (~$68 bln) a month compared to the current JPY7.3 trillion.   BOJ Kuroda, whose term ends next April, insisted that the easy monetary policy stance will continue.   The surprise decision sent ripples across the capital markets.  Japanese stocks slumped, with the Nikkei falling...

Read More »

Caution Advised in Chasing FX, but Wow!

2022-11-11

by

2022-11-11

Overview:  The softer than expected US inflation figures unleashed significant market adjustment that continue to ripple through the capital markets. The modification of some of China’s Covid stance may have also fanned some optimism, but we suggest that measures are modest tweaks, and the surge in infections will prevent the end of disruptive restrictions.

Read More »

The Yen and Yuan Continue to Weaken

2022-09-07

by

2022-09-07

While the US dollar appears to be consolidating its recent gains, the Japanese yen and Chinese yuan remain under pressure. Officials seem more concerned about the pace of the move than the level it has reached. New and large fiscal initiatives that the new UK government has floated has failed to change sentiment toward sterling, which is the second weakest major currency today after the Japanese yen.

Read More »

EMU GDP Surprises, while the Yen’s Short Squeeze Continues

2022-07-29

by

2022-07-29

Overview: The month-end and slew of data is making for a volatile foreign exchange session, while the rash of earnings has generally been seen as favorable though weakness was seen among the semiconductor chip fabricators. China, Hong Kong, and Japanese equities fell but the other large markets in the region rose.

Read More »

What Happened Today in a Few Bullet Points

2022-07-04

by

2022-07-04

1. The most important thing to appreciate is that the market has moved to price not one but two cuts next year.  The first is priced into the September Fed funds futures and the second is in the Dec Fed funds futures. 

Read More »

Angry April TIC Zeroed In On China’s CNY and Japan’s JPY

2022-06-21

by

2022-06-21

If the March gasoline/oil spike hit a weak global economy really hard and caused what more and more looks like a recessionary shock, a(n un)healthy part of it was the acceleration of Euro$ #5 concurrently rippling through the global reserve system.

Read More »

Expect the Unexpected from the Fed

2022-04-28

by

2022-04-28

It has been a rough week in most markets with both equities and bonds declining sharply. Tech stocks have been pummeled with many ‘big names’ plunging more than 50% (from their 52-week high). Some of the bigger names include Zoom Video -75%, PayPal -73%, Netflix -72%, Meta Platforms (Facebook), -53%.

Read More »

Yen Blues

2022-04-19

by

2022-04-19

Benchmark 10-year bonds yields in the US and Europe are at new highs for the year.  The US yield is approaching 2.90%, while European rates are mostly 5-8 bp higher.  The 10-year UK Gilt yield is up nine basis points to push near 1.98%. The higher yields are seeing the yen's losing streak extend, and the greenback has jumped 1% to around JPY128.45  The dollar is trading lower against the other major currencies but the Swiss franc.

Read More »

Greenback Starts New Week on Firm Note

2022-04-18

by

2022-04-18

Overview: With many financial centers, especially in Europe, closed for the long holiday weekend, risk-appetites remain in check. Most Asia Pacific markets fell, and poor earnings from Infosys and Tata Consultancy, saw India pace the decline with a 2% drop. US futures are also trading with a heavier bias. 

Read More »