Comments on the opening of the European and American market
“Does the dollar/yen continue to have solid price movements, or is there a pullback from the yen’s rapid rise or a sense of the dollar being undervalued?”
In European and American foreign exchange markets on the 12th, the dollar and yen are expected to remain firm. While there are concerns about Japan’s foreign exchange intervention, yen selling in response to the sharp appreciation of the yen is pushing up the dollar. Also, if the US Producer Price Index (PPI) is strong this afternoon, the dollar is expected to be bought back as it feels undervalued.
The US consumer price index (CPI) announced on the 11th showed slower growth than expected, with interest rates falling and the dollar weakening in anticipation of two interest rate cuts this year starting in September. Immediately afterwards, the yen rose sharply, and the prices of the dollar and yen fell sharply from the level of 161.60 yen to the level of 157.40 yen, and the euro and yen fell from the level of 175.40 yen to the level of 171.50 yen. Asian markets are likely to be wary of foreign exchange intervention today, following the sharp rise in the yen from the previous day. The dollar/yen pair stopped from the 159 yen level to the 157 yen level, then recovered to the 159 yen level. After this, US inflation indicators will continue to closely watch overseas markets. The Producer Price Index (PPI), including the core index, is expected to rise this afternoon year-on-year and month-on-month, supporting tight monetary policy and the likely impact of high interest rates and strong. dollar. On the other hand, yen selling is likely to be suppressed for the time being due to the sharp rise in the yen, which appears to be the result of foreign exchange intervention the previous day. However, the medium and long-term trend of a weak yen remains unchanged, and the dollar/yen pair is expected to return to the 160 yen level in the short term.
Currency analysis
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