Japanese yen falls when the US dollar strengthens due to rising Treasury yields.
The Japanese yen (JPY) loses ground as the US dollar (USD) advances, boosted by higher Treasury yields. However, the Japanese yen volatility is expected to persist amid suspicion that Japanese authorities could intervene in response to weaker-than-expected US Consumer Price Index (CPI) data.
Yoshimasa Hayashi, the Japanese Chief Cabinet Secretary, has stated that he is willing to use all available forex-related actions.
The Japanese yen (JPY) loses ground as the US dollar (USD) advances, boosted by higher Treasury yields.Yoshimasa Hayashi, the Japanese Chief Cabinet Secretary, declared that he is prepared to use all forex-related actions. Hayashi stated that the Bank of Japan (BoJ) will determine the details of monetary policy. He expects the BoJ to take adequate measures to attain the 2% price objective in a sustainable and consistent manner, as reported by Reuters on Friday.
The Bank of Japan (BoJ) may hike interest rates at its forthcoming July meeting. This assumption boosted the JPY, leading to a drop in the japanese yen pair.
Daily Market Movers: The Japanese Yen fluctuates amid intervention threats.
The Japanese yen (JPY) loses ground as the US dollar (USD) advances, boosted by higher Treasury yields.
Shunichi Suzuki, Japan’s Finance Minister, highlighted Friday that fast foreign exchange (FX) movements are undesirable. Suzuki declined to comment on FX intervention and media claims of Japan’s FX rate checks, as reported by Reuters.
The US Consumer Price Index (CPI) fell by 0.1% month on month in June, reaching its lowest level in more than three years. The headline CPI climbed by 3.0% month on month in June, down from 3.3% in May and below the market consensus of 3.1%.
The core CPI, which excludes volatile food and energy costs, increased by 3.3% year on year in June, compared to 3.4% in May and matching expectations. Meanwhile, the core CPI rose by 0.1% month on month, compared to the predicted and prior figure of 0.2%.
According to Peter Boockvar, chief financial officer at Bleakley Financial Group in the United States, the yen’s depreciation will prompt the Bank of Japan to “React sooner rather than later,” according to Reuters.
According to Reuters, citing unnamed sources, the Bank of Japan will likely lower its economic growth prediction for this year and project inflation to remain around its 2% target in coming years at its meeting this month.
The Fed’s Goolsbee noted that the US economy appeared to be on track to attain 2% inflation.
Austan Goolsbee, President of the Federal Reserve Bank of Chicago, stated on Thursday that the US economy appeared to be on track Achieve 2% inflation. Goolsbee stated: “My view is, this is what the path to 2% looks like,” according to Reuters.
Furthermore On Wednesday, Federal Reserve Chairman Jerome Powell emphasized the importance of closely monitoring the weakening labor market. Powell also expressed confidence in the declining trajectory of inflation, echoing his statements on Tuesday that underlined the importance of further data to improve confidence in the inflation outlook.
Moreover According to a Bloomberg story on Tuesday, the Bank of Japan will hold three in-person meetings with banks, securities firms, and financial institutions over the next few days. These discussions intended to determine a feasible pace for reducing its purchases of Japanese government bonds.
