JPY: USD/JPY Bull Trigger Still Nearby As BoJ Approaches
Oct-30 00:01
USD/JPY couldn't sustain post Fed highs above 153.00, leaving the bull trigger intact at 153.27. We track near 152.75/80 in early Thursday dealings, as markets await the BoJ later today. Dovish rhetoric or too much caution around further hike timing from the BoJ, could see the bull trigger tested. Conversely a more hawkish BoJ backdrop could help cap the pair ahead of the 153.00 region, not withstanding the bounce in US-JP yield differentials as Fed Chair Powell raised doubts on a follow up cut in Dec on Wednesday.
- The risks would arguably rest with a more hawkish BoJ lean today, but this may already be forming part of market thinking, given US Tsy Secretary Bessent's remarks this week (around giving the BoJ space to fight inflation etc).
- Still, downside levels in USD/JPY are still some distance away, with the 20-day in the low 151.00 region, while the 50-day is back close to 149.70.
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
MNI: MNI JAPAN AUG FACTORY OUTPUT -1.2% M/M; JULY -1.2%
Sep-29 23:52
- MNI JAPAN AUG FACTORY OUTPUT -1.2% M/M; JULY -1.2%
- JAPAN AUG FACTORY OUTPUT POSTS 2ND STRAIGHT M/M DROP
MNI: MNI JAPAN AUG RETAIL SALES +1.1% Y/Y; JULY +0.4%
Sep-29 23:51
- MNI JAPAN AUG RETAIL SALES +1.1% Y/Y; JULY +0.4%
- JAPAN AUG RETAIL SALES -1.1% M/M; JULY -1.6%
JGBS: Futures Slightly Firmer Overnight, BOJ SOO Due
Sep-29 23:23
In post-Tokyo trade, JGB futures closed slightly stronger, +3 compared to settlement levels, after US tsys finished Monday's session 2-5bps stronger, with a flatter curve.
- US Government shutdown concerns buoy Tsys into the close. The BLS' key economic releases would be postponed in the event of a government shutdown, per the Department of Labor's plan for such an event.
- Fed Musalem said the Fed must be cautious cutting interest rates further because inflation remains too high, Fed Williams: policy decisions on a meeting-by-meeting basis, adding that this month's rate cut made sense given rising risks to employment, and leaves monetary policy at still-restrictive levels.
- MNI: Japan Govt Keeps Economic View; Ups Spending, Capex. Japan's government slightly tweaked its economic assessment in September, upgrading views on private consumption and capital investment for the first time in over a year, though leaving its overall judgment largely unchanged, the Cabinet Office said Monday.
- MNI INTERVIEW: BOJ Decisions Inconsistent - Ex-BOJ's Yamamoto. Markets are watching Bank of Japan communications more closely than economic data for signals on policy moves, with board decisions seen as inconsistent and driven by convenience rather than fundamentals, former BOJ Executive Director Kenzo Yamamoto told MNI.
- Today, the local calendar will see BOJ Summary of Opinions (Sept. MPM), Industrial Production, Retail Sales and Housing Starts.
