USD/JPY holds above 150 for now – ING

FXStreet Insights Team FXStreet

The Japanese Yen (JPY) remains under pressure this week as investors unwind safe-haven positions amid easing U.S. market concerns. Political developments in Japan have had little impact, with Sanae Takaichi confirmed as prime minister but leading a fragile minority government that limits prospects for major fiscal stimulus, ING's FX analyst Francesco Pesole notes.

Focus turns to BoJ

"Elsewhere, the yen is emerging as an underperformer this week. That appears more related to the unwinding of safe-haven JPY positions as US market concerns ease, and much more marginally due to political events in Japan. This morning, Sanae Takaichi was confirmed as prime minister by the parliament, four votes clear of the majority needed."

"That shows for the moment that she has the support of enough policymakers outside of her LDP-Ishin coalition, which is two votes short of a parliamentary majority. The nature of the minority government means Takaichi will find it hard to implement aggressive fiscal expansion, and market pricing for the BoJ (15bp by year-end) shows high uncertainty about the effective spending/debt implications of the new leadership."

"In our view, there is still a possibility of a 30 October hike (4bp priced in), also due to yen weakness. If not, December looks quite likely in our view. Unless the BoJ moves in October or USD comes under new idiosyncratic pressure, USD/JPY may stay above 150.0 as some debt concerns and carry funding continue to weigh on the yen."

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

GBP/USD hits multi-week tops around 1.3560

GBP/USD gathers fresh steam and advances to new three-month peaks near the 1.3560 zone on Friday. Cable’s sharp move higher comes after three daily drops in a row and follows the increasing selling pressure hurting the Greenback.

EUR/USD pops to fresh two-month highs, targets 1.1600

EUR/USD advances markedly, revisiting the upper 1.1500s for the first time since mid-June. The pair’s sharp uptick comes on the back of a strong retracement in the US Dollar amid BoJ intervention chatter and despite steady uncertainty in the Middle East.

Gold picks up pace, approaches $4,400

Gold rebounds toward the $4,400 mark per troy ounce on Friday, reversing the previous day’s pullback. The precious metal’s recovery comes as fresh and intense weakness keep weighing on the US Dollar, while traders keep assessing easing expectations of an imminent Fed interest rate hike and the situation from the Middle East.

Pi Network Price Forecast: PI extends consolidation as bulls eye $0.10

Pi Network (PI) price holds steady on Friday, maintaining a consolidating tone for three consecutive days. Mild retail strength in the PI token remains stable, with Open Interest above $9 million, while social buzz eases. PI token’s technical outlook is mixed, as bearish momentum wanes to neutral, with bulls eyeing the $0.1000 psychological level.

Weekly focus: Some relief in US inflation concerns

Actual inflation data for July came out as expected with a 0.1% m/m increase in headline CPI and 0.2% excluding food and energy. Annual headline inflation remains too high at 3.4% and means that wage earners are experiencing stagnating spending power at best, and core inflation is a bit higher than the inflation target of two percent would suggest.

Why is Crude Oil priced for a reopening the ships haven't made?

Fourteen vessels crossed the Strait of Hormuz on Tuesday. Before the war, the count ran near 120 a day. In the sessions since the waterway was publicly declared open, Brent has drifted back to $87 and West Texas Intermediate (WTI) to $81, both a little lower again on Wednesday, with daily momentum on each unwound from the top of its range in late July to the low twenties now.