Japanese Yen Crumbles Underneath the Weight of a Sturdy US Greenback. New Peaks for USD/JPY?

Date:


Japanese Yen, USD/JPY, US Greenback, AUD, EUR, GBP, China, Crude Oil – Speaking Factors

  • The Japanese Yen seems susceptible to a galloping US Greenback
  • The BoJ is holding yields down whereas US yields are rocketing up
  • Currencies, commodities, bonds and equities are all in flux for now

The Japanese Yen has sunk to its lowest stage since 1998 towards the US Greenback right now. Whereas the Fed has made it clear that charges are going larger, the Financial institution of Japan (BoJ) re-asserted their yield curve management (YCC) program on Wednesday to maintain bonds yields down.

The ten-year Japanese authorities bond (JGB) traded close to the central financial institution’s higher restrict of 0.25% right now. The financial institution then made bulletins that they might add to their bond purchases inside their scheduled operations.

Treasury yields proceed to soar larger with the 2-year word buying and selling at 3.75%. The US Greenback has proceeded larger throughout the board. The Korean Gained has been hit notably laborious because the nation tallies up the price of yesterday’s storm.

EUR/USD marked a 20-year low of 0.9874 in a single day whereas GBP/USD is threatening to interrupt under the 2020 low of 1.1414, a transfer that will see a brand new 37-year nadir.

The Australian Greenback slipped right now regardless of2Q quarter-on-quarter GDP coming in as forecast at0.9%against the0.8% earlierly that has been revised right down to 0.7%.

Annual GDP to the tip of Julywas 3.6% as a substitute of three.4% anticipated and 3.3% prior. It reveals upward revisions to earlier quarters in 3Q and 4Q 2021.

China’s commerce knowledge was a giant miss at US$ 79.39 billion as a substitute of US$ 92.70 billion forecast and US$ 101.26 billion beforehand. The onshore Yuan hit a 2-year low with USD/CNH buying and selling as excessive as 6.9949.

Commodities weren’t immune from the carnage with gold languishing below US$ 1,700 an oz..

The WTI crude oil futures contract fell to ranges not seen for the reason that begin of the 12 months close to US$ 85 bbl. The Brent contract is round US$ 91.50 bbl.

Arab mild crude costs for Asian prospects had been lowered yesterday by Saudi Aramco. The minimize for October deliveries might be interpreted as a sign of slowing demand.

Fairness markets are feeling the pinch from tightening financial circumstances with a sea of crimson for Asian bourses right now. Futures are pointing to a gentle begin to the European and North American money periods.

After Europe huge GDP knowledge right now, the Financial institution of Canada will probably be making a call on charges. It’s anticipated that they are going to increase the money charge by 75-basis factors to three.25% in keeping with a Bloomberg survey of economists.

A quantity central bankers can even be making feedback.

The total financial calendar might be seen right here.

USD/JPY TECHNICAL ANALYSIS

USD/JPY made a 24-year excessive right now, hitting 144.39.

Resistance could be at 144.97, which is the 161.8%Fibonacci Extensionof the transfer from 139.39 right down to 130.39. An ascending trendline can be close to that stage.

Help might be at break factors of 139.39 and 138.88.

USDJPY CHART

Chart created in TradingView

— Written by Daniel McCarthy, Strategist for DailyFX.com

To contact Daniel, use the feedback part under or @DanMcCathyFX on Twitter



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