ForexLive Asia-Pacific FX news wrap: US yields and dollar rise

Friday, 16 February 2024, 04:46

US PPI data focus on Friday - the ranges expectedFederal Reserve speakers on Friday include Barkin, Barr and DalyBOJ Ueda says will consider policy move when inflation target conditions metJapan finance minister Suzuki concedes that a weak yen has pros and consEuropean Central Bank speakers on Frida...

The USD gained across the major FX board for the session here, with yen a notable loser. USD/JPY rose from lows around 149.85 to be above 150.30 as I update. Japan finance minister Suzuki made statements along his usual lines to try to support the yen and, again as usual, he was not very successful. His remarks were only weakly supportive. He didn’t suggest ‘will do whatever it takes’ and the like.

Also from Japan today we had Bank of Japan Governor Ueda speaking in parliament. Of note from his remarks were:

When sustained, stable achievement of the price target comes into sight, we will examine whether to maintain various easing measures, including negative interest rate.

Based on the economic and price outlook as of now, Japan's monetary conditions will likely remain accommodative even after ending negative rates.

No suggestions of a rush to tighten from the BOJ Gov. USD/JPY moved towards its highs after these comments.

Otherwise it was a lacklustre session. It’s the final day of Chinese market closures, Monday is back to normal. We didn’t get a People’s Bank of China Medium-term Lending Facility (MLF) rate setting this week. Its normally conducted by the Bank on the 15th of the month. Given the holidays it would seem Monday the 19th will be the day, however I have heard that the MLF will be conducted on the 18th. I’ll keep an eye out over the weekend for this.

Most analysts are expecting the interest rate on the borrowing cost of the one-year medium-term lending facility (MLF) loans will be unchanged at 2.5%, but this is not a unanimous consensus.

ICYMI, coming up today from the US are the PPI data for January, I posted a ‘ranges’ heads up to watch for any extreme result, like we got from retail sales on Thursday. The -0.8% m/m for January was beyond the lowest estimate of -0.7% and sent equity traders into a buying frenzy. Although almost everything does it seems.

US PPI data due at 8.30 am US Eastern time.

This article was written by Eamonn Sheridan at www.forexlive.com.

This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.


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