Yen Unfazed by Fed Rate Cut
JPY, USDUSD/JPY turned lower after touching 151 early Monday on slightly higher Treasury yields, as forex traders focused on the bigger picture of lower U.S. bond yields with pricing for an early Fed rate cut becoming stronger.
The dollar-yen rally into the weekend was distorted by month-end effects and spillovers from slumping cryptocurrencies that triggered hit-and-miss effects across assets. The yen’s medium-term gains are unlikely to ease as food inflation in Japan is serious enough to keep the Bank of Japan on track for further rate hikes.
Source: Bloomberg