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The Japanese Yen depreciates, likely due to thin trading conditions stemming from the holiday on Monday. BoJ Governor Ueda stated that the central bank will continue to adjust the level of monetary easing as needed. The US Dollar receives support as Treasury yields improve. The Japanese Yen (JPY) extends its losses for the third consecutive session in holiday-thinned trading on Monday. This downward movement may be influenced by growing concerns that the Bank of Japan (BoJ) is not in a rush to raise interest rates. The Bank of Japan maintained its interest rate target in the range of 0.15-0.25% at Friday’s meeting. BoJ Governor Kazuo Ueda emphasized that the central bank “will continue to adjust the level of monetary easing as needed to achieve our economic and inflation targets.” Ueda acknowledged that while Japan’s economy is showing moderate recovery, there are still signs of underlying weakness. The US Dollar (USD) continues to rise as Treasury yields recover their losses. However, the Greenback may encounter challenges due to growing expectations for additional rate cuts by the US Federal Reserve (Fed) in 2024. According to the CME FedWatch Tool, markets are pricing in a 50% chance of a 50 basis point rate cut to a range of 4.0-4.25% by the end of this year. Daily Digest Market Movers: Japanese Yen depreciates due to concerns of BoJ delaying rate hikes Japan’s new “top currency diplomat,” Atsushi Mimura, stated in an interview with NHK that the Yen carry trades accumulated in the past have likely been mostly unwound. Mimura cautioned that if such trades were to increase again, it could lead to heightened market volatility. “We are always monitoring the markets to ensure that does not happen,” he added. On Friday, Philadelphia Fed President Patrick Harker stated that the US central bank has effectively…

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Filed under: News - @ September 23, 2024 5:20 am