financetom
News
financetom
/
News
/
Yen skids to three-week trough on interest rate gap concerns
News World Market Environment Technology Personal Finance Politics Retail Business Economy Cryptocurrency Forex Stocks Market Commodities
Yen skids to three-week trough on interest rate gap concerns
May 23, 2024 1:44 AM

Yen skidded in Asian trade on Thursday to three-week lows against the US dollar, sharpening losses for the second straight session amid persistent concerns about the Japan-US interest rate gap.

The odds of a Fed interest rate cut in the summer dipped after the release of the Federal Reserves meeting minutes, with investors now awaiting more clues.

And following a recent spate of weak Japan data, its likely the Bank of Japan will maintain its current ultra-easy policies unchanged for sometime.

The Price

The USD/JPY pair rose 0.1% today to 156.90 yen, the highest since May 1, with a session-low at 156.66.

The yen lost 0.4% on Tuesday, the fourth loss in five days as long-term US treasury yields rebounded.

Interest Rate Gap

The US-Japan interest rate gap currently stands at 540 basis points in favor of the US, and will likely remain so for an extended duration.

US Rates

The recently released Federal Reserves meeting minutes showed that Fed officials are concerned about the suitable timing of a rate cut, with several members expressing concerns about consumers using riskier financing methods to cover costs due to inflation.

Fed officials pointed to the persistent risks of inflation, with factors including geopolitical events, and they focused on the impact on consumers, especially low-income workers.

Japanese Rates

Recent weak data from Japan on growth and the services sector proved disappointing, in turn hurting the odds of a Bank of Japans interest rate cut this year.

Yens Outlook

UBSs New York analysts believe that markets are ignoring the risks of a BOJ intervention once more, which continues to present a fresh risk of sudden movements.

Comments
Welcome to financetom comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
Related Articles >
Yen skids to three-month low as the gap in treasury yields widens
Yen skids to three-month low as the gap in treasury yields widens
Oct 26, 2024
The yen fell in European trade on Wednesday against a basket of major rivals, sharpening the losses for the third straight session against the US dollar and hitting three-month lows amid concerns about a wider US-Japan gap in government treasury yields. Recent bearish remarks from Japanese officials hurt the odds of a third BOJ interest rate hike this year, while...
Euro rebounds ahead of major eurozone data
Euro rebounds ahead of major eurozone data
Oct 27, 2024
The euro rose in European trade on Thursday against a basket of major rivals after a wave of losses across three sessions, with the euro eventually settling above 3-⅕ month lows against the US dollar. It comes ahead of major data on the eurozone sectors later today, which would shed important light on the health of the European economy in...
Yen skids to three-month trough as Japanese governing coalition loses majority
Yen skids to three-month trough as Japanese governing coalition loses majority
Oct 28, 2024
The Japanese yen skidded in Asian trade on Monday to three-month lows against the US dollar, after the election loss by the current Japanese parliamentary governing coalition, which could impede future interest rate hikes by the Bank of Japan. The yen is also pressured by a surge in US 10-year treasury yields, amid speculation about a cautious stance by the...
US dollar heads for fresh weekly profit
US dollar heads for fresh weekly profit
Oct 26, 2024
The US dollar rose in European trade on Friday against a basket of major rivals, resuming gains after a short hiatus, and approaching three-month highs once more. The gains come amid a surge in US 10-year treasury yields after bullish remarks from some Fed officials, and strong US data, which hurt the odds of an aggressive pace for US interest...
Copyright 2023-2025 - www.financetom.com All Rights Reserved