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Forex Friday: USD, GBP, TRY, CHF and JPY
In this week’s edition, we discuss the dollar’s latest big gains following this week’s central bank meetings, among other things.
USD/JPY dives but is government intervention effective?
Is the BoJ undoing the government’s attempt to shore up the yen?
FOMC as expected; markets extremely volatile during presser.
As for other central bank meetings: within the next 20 hours markets will hear from the BOJ, SNB, Norges Bank, BOE, and SARB.
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European Open: Implied volatility spikes, BOJ gets active ahead of FOMC
Rising yields ahead of the FOMC meeting has seen the BOJ announce bond purchases, and implied volatility has risen notably for the next 24-hours.
How to trade inflation?
With inflation remaining stubbornly elevated and fears of a recession rising, where are there still opportunities in the market?
European Open: Options trades expect a more volatile (and weaker) USD/JPY
A notable rise of downside protection, and increase in implied volatility over the next week for USD/JPY suggests traders are taking precautions.
BOJ can talk the talk, but can it walk the walk?
The BOJ meets next week. Watch for the central bank to use additional tools to try and strengthen the Yen.
Kuroda is likely rolling his eyes as USD/JPY taps 145
Another strong inflation report for the US prompted a sharp reversal across global markets overnight - in favour of the US dollar and yields, but to the detriment of commodities and indices.
US CPI comes in hotter than expected! Is a 75bps rate hike locked in?
US August CPI came in hotter than expected, but the bigger surprise was the strength in the Core CPI reading.
European Open: BOJ Governor Kuroda jawbones then yen
Yen pairs were given a jolt ahead of the European open after BOJ Governor Kuroda made a few comments on currency movements.
European Open: USD/JPY taps 144, Oil breaks lower, BOC in focus
It’s been a relatively lively session for traders overnight which saw USD/JPY steam ahead above 144 and WTI hit a new cycle low. Next up we have the BOC meeting.
Two trades to watch: EUR/GBP, USD/JPY
EUR/GBP falls as new UK PM Liz Truss looks to tackle the energy crisis. USD/JPY rises to a 24 year high ahead of US ISM services PMI
US NFP close to expectations. Will it make a difference to the Fed?
There doesn’t appear to be anything that would sway the Fed’s rate decision for either a 50bps increase or a 75bps increase at the next meeting.
3 Trades to watch after Jackson Hole: EUR/USD, USD/JPY, Nasdaq
The US dollar was the clear winner following Jerome Powell's Jackson Hole speech, and Wall Street the clear loser - with rates unlikely to come down any time soon.
European Open: US inflation and Powell’s Jackson Hole Speech in focus
Jerome Powell will be hoping that inflation data, released just 90 minutes before his Jackson Hole speech, softens as expected.
Two trades to watch: DAX, USD/JPY
DAX rises post GDP data, IFO business climate up next. USD/JPY slips on USD weakness as Jackson Hole begins and ahead of US GDP and jobless claims figures.
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July housing data concludes on a mixed note; waiting on Jackson Hole
July housing data finished up this week with worse than expected New Home Sales and better than expected Pending Home Sales.
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US PMI’s disappoint ahead of key inflation data and Jackson Hole
Whilst US PMI data disappointed, it’s not as though the economic deterioration we’re witnessing didn’t come without plenty of warning. And the upshot all this is that it's deflationary.
Japan’s inflation hits a 7.5 year high – but will the BOJ act?
Inflation continues to rise in Japan, albeit at a much slower pace than its peers. But we don’t expect a rate hike any time soon.
European Open: Gold bears eye $1750, USD/JPY bulls eye 136
The US dollar has perked up following yesterday’s FOMC minutes, and that has placed gold and USD/JPY onto our radars in anticipation of continued dollar strength.
Retail Sales data mixed ; USD/JPY continues higher
The July headline Retail Sales print was slightly weaker; however, the core print was stronger. Due to the mixed data, USD/JPY continued its overnight path higher as price broke out of a descending wedge.
European Open: UK CPI up next, USD/JPY holds 134 ahead of retail sales
With peak inflation remaining a key theme for traders, attention now turns to UK CPI data at 07:00 BST.
USD/JPY heading to 130?
With the odds of 75 basis point hike having dropped, the Fed is careful not to push too hard against that...