AUD/JPY rises to near 97.50 after hawkish remarks from Commonwealth Bank CEO

AUD/JPY edges higher to near 97.50 during the European session after experiencing a volatile session on Wednesday. The cross reversed intraday losses and entered into positive territory as the Australian Dollar (AUD) strengthened.

The hawkish remarks from Commonwealth Bank CEO Matt Comyn attracted some buyers for the Aussie Dollar and, consequently, acted as a tailwind for the AUD/JPY cross. He suggested that the Reserve Bank of Australia (RBA) might delay interest rate cuts until early 2025 due to steady inflation. Comyn's comments raised concerns about increased living costs for borrowers relying on tax cuts and mortgage relief.

However, the Australian Dollar faced downward pressure as the S&P/ASX 200 Index plunged to recent lows, driven by a selloff in mining and financial stocks following Wall Street's decline overnight in response to stronger-than-expected US inflation figures.

On the other side, Japan’s top currency diplomat Masato Kanda reiterated that authorities stand ready to intervene in the Forex market if necessary. This stance might have bolstered the Japanese Yen (JPY), consequently undermining the AUD/JPY cross during Wednesday's Asian session. Furthermore, Japan's Finance Minister Shunichi Suzuki said that rapid currency moves are undesirable and that the government is watching the market with stronger urgency.

Investors await the preliminary Q4 Gross Domestic Product (GDP) data 2023 due on Thursday. Investors forecast that the Japanese economy could show a growth of 0.3% after contracting by 0.7% in the third quarter.