Eyes are on the yen on an enormous transfer decrease in USD/JPY forward of the weekend. The pair is down 202 pips on the day now to 156.40, which is a pointy reversal after rising to 159.22 when the Financial institution of Japan left charges on maintain.
USDJPY 10 minutes
There’s some chatter that is unconfirmed that Japan’s Ministry of Finance (which controls FX intervention) ran a price test. That is the place they name round to banks and ask for present yen costs.
That sort of transfer is a little bit of theater but it surely’s a sign to everybody that they are carefully watching the market, and ready to become involved. It is typically the ultimate step earlier than truly intervening. Once more, typically these rumors observe value motion so it is robust to inform.
As for precise intervention, that is not what this appears to be like wish to me. Usually, they hit a lot tougher and swifter. This appears to be like extra like stops and robust, regular USD/JPY promoting.
Notably, that is coming with the US greenback underneath some critical strain throughout the board. Additional to that, oil costs are robust right now in a curious transfer. I hate to do an excessive amount of hypothesis however Trump has been making some weekend strikes and the market may nonetheless be excited about what occurred in Venezuela. The plain inference is that one thing may occur in Iran, which might be each USD adverse and oil constructive (throw in some valuable metals bullishness too).
Apart from the same old corners of the web which are continually speaking about US army strikes, I do not see something alongside these strains. Then once more, there was a little bit of smoke round Venezuela however not actual hearth.
So all this to say that it is probably not clear what’s behind the valuable metals shopping for, greenback promoting and oil bids right now.
