Market awaiting comments from Bank of Japan Governor • US yields fall after Fed minutes
The Japanese yen rose in the Asian market on Thursday against a basket of global currencies, about to touch a two-week high against the US dollar, within a limited range of trading, as investors were reluctant to build large positions, pending the testimony of Japan Bank Governor Kazuo Oeda before the local parliament about the recent monetary policy meeting.
US bond yields continue to fall after the release of the minutes of the Federal Reserve’s latest monetary policy meeting, which boosted the prospects of starting the monetary easing cycle and cutting interest rates starting next September.
Price outlook • Japanese yen exchange rate today: The dollar fell against the yen by about 0.3% to (144.85¥), from the opening price of today’s trading at (145.26 ¥), and recorded the highest level at (145.64 ¥).
The Japanese yen ended Wednesday’s trading unchanged against the US dollar, after earlier trading hit a two-week high of 144.45 yen.Kazuo Oeda testimony Traders are watching closely as a special session of the Japanese parliament on Friday, discussing the Japan Bank’s unexpected decision to raise interest rates last month and the central bank’s abrupt shift towards normalizing monetary policy.
Bank of Japan Governor Kazuo Oeda will speak about the latest decisions, and investors will focus on his tone after his influential vice president, Shinichi Uchida, adopted a more dovish stance earlier this month, helping calm markets and easing pressure on the dismantling of curry yen deals.
US Bond YieldThe yield on 10-year US Treasury bonds fell on Thursday by 0.1 percentage point, extending losses for the fifth consecutive session, near a two-week low of 3.763%, which reduces investment opportunities in the US dollar.
Read also :People’s Bank of China sets dollar exchange rate at 7.1228 yuan
This development in the US bond market comes after the release of minutes of the last meeting of the Federal Reserve, which showed that members are strongly leaning towards cutting interest rates at the September meeting, and many of them were willing to cut borrowing costs immediately.
According to CME Group’s FeedWatch: pricing the odds of a 50 basis point cut in US interest rates at the September meeting are currently stable at 35%, and the pricing of the odds of a cut by about 25 basis points at 65%.
Narrowing the gap on long-term bond yields between Japan and the United States, making Japan currency yields an investment target for short buyers and deal financing, which favors the appreciation of the Japanese yen.
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