Headlines:
- USD/JPY tumbles again after early bounce, Japan MOF back in the market?
- USD/JPY wipes out a chunk of the likely intervention play earlier, so what’s next?
- US futures keep steadier for now even as oil prices hold at the highs
- ECB policymaker Nagel says more appropriate to respond in June if outlook does not improve
- ECB policymaker Makhlouf says concerned about energy prices staying higher for longer
- UK April Nationwide house prices +0.4% vs -0.3% m/m expected
Markets:
- Japanese yen jumps on suspected second round of intervention, but erases gains after
- USD/JPY falls from 157.00 to 155.50 before recovering to 156.50-60
- Brent crude up 0.5% to $111.03 while WTI crude down 0.7% to $104.35
- S&P 500 futures up 0.1%
- US 10-year yields flat at 4.385%
- Gold lower by 1% to $4,575
- Bitcoin up 1.2% to $77,387
With European markets closed for the day, it was supposed to be a quieter session in general.
Instead, Tokyo officials looked to have taken that opportunity to enact a second round of intervention today. USD/JPY was steadily trading back up above 157.00 following the drop yesterday, before quickly sliding to a low of 155.50 in a matter of minutes. The drop was ultimately a very brief one though, with the pair hastily bouncing back to settle around 156.50-60 levels now – trading flat on the day.
BOJ data suggested that there was intervention yesterday, with likely $35 billion spent by the Japan ministry of finance to buy up the yen. If confirmed, that should roughly be the most spent on recent interventions since April 2024.
The trouble with the latest bounce is that it is suggestive that such taps by Tokyo is starting to lose its effectiveness. That especially since the fundamental landscape is overwhelmingly negative for the yen at the moment.
Looking to broader markets, the overall mood is more mixed as traders and investors remain gripped by the US-Iran war. There’s still no word on any progress on talks, just a report that Iran might submit a revised peace proposal later today.
Oil prices are keeping mixed but off early highs with Brent crude up 0.5% to $111.03 while WTI crude is down 0.7% to $104.35 on the day.
US futures are keeping steadier after the positive gains yesterday, as investors look to prove that it wasn’t just month-end shenanigans driving up the mood in Wall Street.
Besides that, precious metals are sitting lower though with gold down 1% to $4,575 as we look to a more tepid end to the week.
This article was written by Justin Low at investinglive.com.
