USD/JPY: Level fundamentally justified from market’s point of view is much higher than 150 – Commerzbank

FXStreet Insights Team FXStreet

It seems to be the case that, shortly after the start of FX trading in Asia, USD/JPY briefly traded above the important level of 150. Economists at Commerzbank analyze the pair’s outlook.

Market assumption that 150 constitutes the MOF’s line of defense can turn into a self-fulfilling prophecy

The extremely small distance of the exchange rate to 150 constitutes a sign that the exchange rate fundamentally justified from the market’s point of view is much higher than 150.

If the MOF were to not intervene after a serious breach of 150, we would have to expect a very, very significant jump of the JPY exchange rates. That is not likely to be what the MOF wants. As a result, it will have no choice but to take action when a serious breach of 150 arises. The market assumption that 150 constitutes the MOF’s line of defense can turn into a self-fulfilling prophecy.

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 holds above 1.3450 despite Mideast uncertainty

GBP/USD trades flat on the day above 1.3450 following the bearish action seen in the early European session on Thursday. Conflicting rhetoric from US and Iranian officials about a potential deal fuels market concerns and limits the pair's upside, while investors refrain from taking large positions ahead of Friday's critical Nonfarm Payrolls data from the US.

EUR/USD declines below 1.1550 on modest USD recovery

EUR/USD corrects lower after posting gains for two consecutive days and trades below 1.1550 in the second half of the day on Thursday. Markets stay wary about the prospects of a US-Iran peace deal and the reopening of the Strait of Hormuz, keeping the safe-haven USD underpinned and making it difficult for the pair to regain its traction.

How Wall Street rigs the game [Video]

In this week’s Live from the Vault, Andrew Maguire is joined by Peter Antico and Sean Stone to discuss the Paradigm of Money - an in-depth expose of financial market corruption, from naked shorting to the two-tier system that protects Wall Street.

Top Altcoins: Ripple, Cardano, and Solana vulnerable to deeper losses

Ripple, Cardano, and Solana are trading in the red on Thursday, facing downside pressure. The technical outlook for altcoins is bearish, as XRP risks falling below $1.00, ADA is eyeing the 50-day Exponential Moving Average at $0.1766, and SOL remains capped below a cluster of resistance levels.

AI defies the disinflationary playbook: Why lower oil prices might not be enough to cool core inflation

The global economic landscape has been fixated on the Middle East since the US-Iran war started in late February, reacting to significant changes in crude Oil prices and assessing how they could influence inflation dynamics and growth outlook.

9-3: Is the Federal Reserve’s vote tally Warsh's new forward guidance?

The rate did not move. Neither did the statement, and that’s the more interesting fact. Set the July 29 Federal Open Market Committee (FOMC) statement beside the one issued on June 17, and the two documents are identical apart from a single verb and a paragraph at the bottom naming three dissenters.