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☆ Japan Sept consumer inflation seen at 8-year high, above BOJ's target for 6th month: Reuters poll
▼ + stars: | 2022-10-14 | by ( ) www.reuters.com time to read: +2 min

The forecast strongly suggested that core CPI would stay above the central bank's 2% inflation target for a sixth consecutive month. Governor Haruhiko Kuroda has repeatedly vowed to keep the BOJ's stimulus effort intact, because any cost-push rise in inflation would be temporary. It would be the 14th straight month of deficits and follow a record 2.817 trillion yen shortfall in August. Imports by value likely surged 45.0% in September from a year earlier, outpacing a 27.1% rise in exports, the poll showed. The government will release the consumer price data on Oct. 21 at 8:30 a.m. (Oct. 20, 2330 GMT) and the trade balance data on Oct. 20 at 8:50 a.m. (Oct. 19, 2350 GMT).

Their joint communique released by the U.S. Treasury late on Wednesday did give Japan something - but it was thin gruel. read more"Recognizing that many currencies have moved significantly this year with increased volatility, we reaffirm our exchange rate commitments as elaborated in May 2017," the G7 wrote. And, for the record, the 2017 phraseology was that excess volatility and disorderly currency moves have negative impacts on their economies and financial stability. read more"We cannot tolerate excessive volatility in the currency market driven by speculative moves," he opined after. The big question is whether this dollar surge is in fact a "short run" aberration or whether it is a more permanent feature of the global landscape.

☆ Reactions: US Sept CPI fortifies hawkish case in Fed inflation battle
▼ + stars: | 2022-10-13 | by ( ) www.reuters.com time to read: +6 min

FOREX: The dollar index turned 0.44% higherCOMMENTS:KEN POLCARI, MANAGING PARTNER, KACE CAPITAL ADVISORS, BOCA RATON, FLORIDA“Not good, hello – market collapsing. With a 3.5% unemployment rate, there's no way the Fed is going to stop raising rates until after the end of the year." The Fed has got to get a handle on inflation right now. RYAN DETRICK, CHIEF MARKET STRATEGIST, CARSON GROUP, OMAHA“This is a yet another disappointing sign that inflation continues to stay stubbornly high. There are still two more CPI prints before the December meeting with the Fed, but for now, the pivot is on pause.

☆ IMF sees Japan's currency intervention as 'signaling' move with short-term impact
▼ + stars: | 2022-10-13 | by ( Leika Kihara | ) www.reuters.com time to read: +3 min

Panth said Japanese authorities likely intervened last month with the view that the yen's "pretty sharp" moves could dampen corporate investment and hurt consumer confidence. "It was a fairly small amount given how liquid the market is," Panth said, referring to the size of Japan's intervention. Panth said he had not seen anything so far that suggests the yen's value is deviating from Japan's economic fundamentals. When looked at historically, the impact of these kinds of interventions doesn't last very long," he said. The intervention was a one-time event so far of relatively small magnitude in a deep market."

☆ Japan wholesale prices rise the most in 5 months, put squeeze on corp profits
▼ + stars: | 2022-10-13 | by ( Tetsushi Kajimoto | ) www.reuters.com time to read: +2 min

Summary Wholesale price index hits highest level on recordFirms struggle to pass on costs, building pressure on marginsYen-based import prices up 48.0% yr/yr in SeptTOKYO, Oct 13 (Reuters) - Japanese corporate goods prices grew the most in five months in September, Bank of Japan data showed on Thursday, highlighting the squeeze on business profits from persistently strong wholesale inflation. The 9.7% year-on-year rise in the corporate goods price index (CGPI), which measures the price companies charge each other for their goods and services, was much bigger than a median market forecast for a 8.8% increase, BOJ data showed. Register now for FREE unlimited access to Reuters.com RegisterA weak yen, which inflates the cost of imports, has exacerbated already high wholesale inflation from a global surge in commodity prices. The month-on-month input cost pressure also remained strong, with wholesale prices up 0.7% in September from August, when it increased 0.4%. The yen-based import price index rose 48.0% year-on-year in September, after a revised 43.2 in August and a revised 49.2% in July, the data showed.

☆ Morning Bid: Xi bangs the drums
▼ + stars: | 2022-10-13 | by ( ) www.reuters.com time to read: +3 min

Asian markets will open with a spring in their step on Friday after the huge 'risk-on' rally Thursday. They will be on FX intervention alert too, after the dollar's spike to a 32-year high of 147.67 yen. The bullish whoosh across markets on Thursday pulled the dollar back a bit, but it remains above 147.00. A G7 statement late on Thursday reaffirming policymakers' commitment that excessive FX moves are undesirable seems to have barely registered among FX traders. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

Banknotes of the euro, Hong Kong dollar, U.S. dollar, Japanese yen, GB pound and Chinese yuan are seen in this picture illustration, in Beijing, China, January 21, 2016. Register now for FREE unlimited access to Reuters.com RegisterData showing U.S. producer prices increased more than expected in September, further boosted the dollar against the yen. Following the U.S. PPI data, the greenback rose as high as 146.88 yen , its strongest level since August 1998. Japanese authorities staged their first yen-buying intervention since 1998 on Sept. 22, when the dollar was at 145.90 yen. The risk-sensitive Australian dollar sank to a 2 1/2-year low of US$0.6236, and was last flat on the day at US$0.6268.

☆ BOJ's Kuroda warns against fast, one-sided yen falls
▼ + stars: | 2022-10-12 | by ( Leika Kihara | ) www.reuters.com time to read: +1 min

“Yen depreciation may have good impact on the macro-economy as a whole, but there are some sectors which are suffering” from the weak yen, Kuroda said at an annual meeting of the Institute of International Finance. “We have to be carefully watching and analysing the impact of currency movements on the economy including on various sectors,” he said. Japan intervened in the currency market last month to arrest sharp yen falls, driven largely by the policy divergence between aggressive U.S. interest rate hikes and the BOJ’s resolve to keep monetary policy ultra-loose. Kuroda reiterated the BOJ’s commitment to keep interest rates ultra-low, arguing that the economy has yet to recover pre-pandemic levels and inflation remained modest compared with Western economies. “Wages are certainly rising now but insufficient to guarantee 2% inflation in a sustainable and stable manner,” Kuroda said.

The dollar strengthened 0.22% to 146.18 yen in Asian trading, after pushing as high as 146.39 for the first time since August 1998. The Japanese currency is particularly sensitive to the gap between U.S. and Japanese long-term bond yields. Japanese authorities staged their first yen-buying intervention since 1998 on Sept. 22, when the yen tumbled to as low as 145.90 per dollar. Elsewhere, sterling which earlier touched $1.0925, marking a fresh low since Sept. 29, bounced 0.4% to $1.1008 after the FT report. The euro slumped to its weakest since Sept. 29 overnight at $0.9670 and remained not far from that level, trading 0.08% lower than Tuesday's close at $0.96975.

☆ Dollar at 24-year peak to yen as U.S. yields jump; sterling on the ropes
▼ + stars: | 2022-10-12 | by ( Kevin Buckland | ) www.reuters.com time to read: +4 min

The Japanese currency is particularly sensitive to the gap between U.S. and Japanese long-term bond yields. Japanese officials staged their first yen-buying intervention since 1998 on Sept. 22, when the yen tumbled to as low as 145.90 per dollar. Sterling slipped 0.13% to $1.0947, and earlier touched $1.09385, marking a fresh low since Sept. 29, following the comments by the BoE governor. Gilt yields soared on Tuesday, lifting yields in the U.S. and elsewhere. The New Zealand dollar was 0.21% lower at $0.5570, approaching the previous day's low of $0.5536, a level not visited since March 2020.

☆ Morning Bid: The final countdown
▼ + stars: | 2022-10-12 | by ( Nidal Al-Mughrabi | Ahmed Mohamed Hassan | ) www.reuters.com time to read: +2 min

Register now for FREE unlimited access to Reuters.com RegisterFor some, it will be new territory. For all of them, being forced to spend billions of dollars of FX reserves is uncomfortable territory. A strong U.S. inflation print will likely push it even higher, intensifying the battle-ready resolve of central banks around the world. Cross-currency basis swaps, essentially a measure of dollar shortage and overall stress in the market, are at alarming levels. U.S. Treasury Secretary Janet Yellen said on Tuesday she sees no signs of stress or undue volatility in financial markets.

☆ Here's the outlook for corporate financial results as the worsening global economy is poised to lift the US dollar higher
▼ + stars: | 2022-10-12 | by ( Jason Ma | ) www.businessinsider.com time to read: +6 min

Good morning, this is Jason Ma and today's edition highlights the outlook for corporate financial results as the US dollar rises. Here's what a strong dollar means for stocks as earnings season heats up. If the reading tops 8.3%, then expect the stock market to sell off by 5%, the bank's trading desk said. But readings below 8.1% could spark some big gains for the stock market. How has the strong dollar affected your portfolio?

☆ Japan manufacturers' mood sours again, higher costs dim outlook - Reuters Tankan
▼ + stars: | 2022-10-11 | by ( Tetsushi Kajimoto | ) www.reuters.com time to read: +2 min

FILE PHOTO: A factory area is seen in front of Mount Fuji in Yokohama, Japan, January 16, 2017. The monthly poll, which tracks the Bank of Japan’s (BOJ) closely-watched tankan quarterly survey, found manufacturers’ mood expected to deteriorate again over the coming three months while service-sector mood was seen rebounding further. “There are concerns about worsening profits due to import costs boosted by a weak yen on top of rising raw materials and energy costs,” said a manager of a food-processing firm. The BOJ’s last survey showed on Oct. 3 big manufacturers’ mood worsened in July-September for a third straight quarter as high material costs dim recovery prospects for the fragile economy. The Reuters Tankan index readings are derived by subtracting the percentage of respondents who say conditions are poor from those who say they are good.

☆ Japan manufacturers' mood sours, higher costs dim outlook - Reuters Tankan
▼ + stars: | 2022-10-11 | by ( Tetsushi Kajimoto | ) www.reuters.com time to read: +3 min

REUTERS/Issei Kato/File PhotoThe monthly poll, which tracks the Bank of Japan’s (BOJ) closely watched tankan quarterly survey, found manufacturers’ mood is expected to deteriorate again over the coming three months while service-sector mood was seen rebounding further. Industries such as autos, steel and textiles weighed on overall manufacturers’ sentiment, while communications, transport and utilities led non-manufacturers. “The prices of products are not keeping pace with surging raw materials costs” as many subcontractors in the supply chain could not pass on input costs to their clients, one manager at a chemicals maker said. “There are concerns about worsening profits due to import costs boosted by a weak yen on top of rising raw materials and energy costs,” said a manager of a food-processing firm. The BOJ’s last survey on Oct. 3 showed big manufacturers’ mood had worsened in July-September for a third straight quarter as high material costs dimmed recovery prospects for the fragile economy.

Banknotes of Japanese yen are seen in this illustration picture taken September 22, 2022. REUTERS/Florence Lo/IllustrationOct 11 (Reuters) - Japanese retail foreign currency deposits have jumped this year as local investors switch out of a weakening yen and zero-yielding local bond markets and into overseas markets with rising yields. Bank of Japan data shows foreign currency deposits at domestic banks surged to 26.58 trillion yen ($182.38 billion) at the end of August, an 8.3% rise since the start of the year. Analysts expect a further rise in foreign currency deposits, given the yen's extended weakness and as Japanese investors look for ways to deploy idle assets. This rise in interest in foreign currency deposits comes at a time when the yen is trading at 24-year lows, and the BOJ is trying hard to stem its decline.

LONDON, Oct 11 (Reuters) - The U.S. dollar edged back towards September's multi-year highs on Tuesday as worries about rising interest rates and geopolitical tensions unsettled investors, while the yen hovered near the level that prompted last month's intervention. "There are the Fed minutes and U.S. CPI this week that will be quite important for strengthening hawkish Fed expectations and could continue to support the dollar," Pesole added. "It's not that easy to gauge at which level the Bank of Japan will intervene," ING's Pesole said. "It's mostly a matter of how orderly the depreciation in the yen is," Pesole added, although he doubts the BoJ would be comfortable with the yen at 150 per dollar. Adding to the BoE's headaches was labour market data that showed Britain's unemployment rate fall to its lowest since 1974 in the three months to August, but the drop was driven by a record jump in the number of people leaving the labour market.

☆ Japan PM Kishida 'not thinking of shortening' BOJ Kuroda's term - FT
▼ + stars: | 2022-10-11 | by ( ) www.reuters.com time to read: +1 min

Kishida also said the BOJ needed to maintain its current policy until wages rise and that companies need to increase pay, according to the newspaper. The comments from Kishida come as the yen has been sold heavily this year due to the widening gap between U.S. and Japanese interest rates. Register now for FREE unlimited access to Reuters.com RegisterReferring to Kuroda's 10-year tenure which ends in April next year, Kishida said: "At the moment, I am not thinking of shortening his term." "It’s hard to put a figure on what level of inflation is appropriate," Kishida also said. The BOJ has aimed for 2% annual consumer inflation as the target of its monetary policy.

☆ Dollar gains as geopolitical worries, rate hike fear rattle market
▼ + stars: | 2022-10-11 | by ( Ankur Banerjee | ) www.reuters.com time to read: +3 min

"This renewed wall of worries is likely to keep the dollar supported," he said, but cautioned that there could be a bit of a relief rally in risky assets. U.S. dollar index was up 0.239% at 113.34, inching toward the 20-year high of 114.78 it touched late last month. Fear of intervention has held the yen firm in recent weeks, but as it drifts back to multi-decade lows analysts aren't convinced it can hold the line. The risk-sensitive Australian dollar made a 2-1/2 year low of $0.6275 on Monday and hovered at $0.6267 on Tuesday. Yields on the 30-year bond leapt as much as 11 basis points to the highest in almost nine years at 3.956%.

☆ Dollar gains, yen flirts with intervention levels
▼ + stars: | 2022-10-11 | by ( Ankur Banerjee | ) www.reuters.com time to read: +2 min

Oct 11 (Reuters) - The dollar loomed large over fragile financial markets on Tuesday, with worries about rising interest rates, global growth and geopolitical tensions unsettling investors, while the yen was testing levels that have prompted official intervention. The yen hit 145.80 per dollar overnight, just 10 pips short of the 24-year trough it made before the Japanese government stepped in to prop it up three weeks ago. The risk-sensitive Australian dollar made a 2-1/2 year low of $0.6275 on Monday and hovered at $0.6296 early on Tuesday. "Our expectation for the world economy to enter recession next year is consistent with further gains in the dollar," said Commonwealth Bank of Australia strategist Carol Kong. U.S. dollar index was up 0.053% at 113.12, not far off the 20-year high of 114.78 it touched late last month.

☆ Morning Bid: The song remains the same
▼ + stars: | 2022-10-10 | by ( ) www.reuters.com time to read: +2 min

Russia's bombing of Kyiv and other Ukrainian cities on Monday darkened what was already a pretty bleak mood across world markets, and investors will be hoping something somewhere eases the selling pressure on Tuesday. Register now for FREE unlimited access to Reuters.com RegisterUnfortunately, nothing obvious jumps out. Asian assets suffered more - the MSCI Asia ex-Japan equity index fell 2%, and several currencies in the region weakened sharply. The Biden administration's proposals include measures to cut off China from certain semiconductors made anywhere in the world with U.S. equipment. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

☆ Dollar climbs as case for U.S. rate hikes firms
▼ + stars: | 2022-10-09 | by ( Tom Westbrook | ) www.reuters.com time to read: +3 min

U.S. unemployment unexpectedly fell last month, Friday figures showed, and inflation data due on Thursday is forecast to show headline inflation at a hot 8.1% year-on-year. Westpac strategist Sean Callow said the data and rising yields in response was a "robust combination for the dollar." Register now for FREE unlimited access to Reuters.com Register"It's further evidence that the U.S. economy is not cratering," he said. The U.S. dollar index was steady at 112.83, off lows around 110 last week and creeping back toward last month's 20-year high of 114.78. Chinese markets reopen after a week-long holiday, and ahead of that the offshore yuan was steady at 7.1310 per dollar.

☆ Japan considers steps to help with utility bill burden
▼ + stars: | 2022-09-29 | by ( Leika Kihara | Takahiko Wada | ) www.reuters.com time to read: +3 min

TOKYO (Reuters) -Japan will consider more steps to cushion the blow of rising electricity bills, a government spokesperson said on Thursday, underscoring the pressure it faces in addressing the burden on households of higher prices for imports from a weak yen. “We’ll scrutinise developments of electricity bills and consider whether further steps could be necessary,” he said. The government is expected to announce a package of measures to cushion rising inflation next month, which is likely to be funded by another supplementary budget. “If the government does take steps to curb utility bills, that will put some downward pressure on consumer inflation,” said Toru Suehiro, chief economist at Daiwa Securities. BOJ Governor Haruhiko Kuroda has ruled out raising Japan’s ultra-low interest rates any time soon, arguing that core consumer inflation would ease back below 2% next fiscal year when cost-push factors dissipate.

☆ BOJ board agreed must be vigilant to sharp yen moves - July minutes
▼ + stars: | 2022-09-28 | by ( Leika Kihara | ) www.reuters.com time to read: +1 min

TOKYO, Sept 28 (Reuters) - Bank of Japan (BOJ) board members agreed that the central bank must scrutinise how the yen's recent sharp moves could affect inflation, minutes of the BOJ's July policy meeting showed on Wednesday. One member said the downward pressure on the yen may ease as the global economic slowdown begins to weigh on inflation and long-term interest rates across the world, the minutes showed. "If the global economy experiences a shock, there's a chance the current weak-yen trend could change into a strong-yen trend," another board member was quoted as saying. In a surprise move last week, the government intervened in the currency market to stem yen weakness by selling dollars and buying yen for the first time since 1998. Register now for FREE unlimited access to Reuters.com RegisterReporting by Leika Kihara; Editing by Christian Schmollinger & Shri NavaratnamOur Standards: The Thomson Reuters Trust Principles.

☆ Plunging pound pauses as investors await policy response
▼ + stars: | 2022-09-27 | by ( Tom Westbrook | ) www.reuters.com time to read: +3 min

On Friday and again on Monday the pound plunged, finding a record low of $1.0327 as investors question Britain's economic gambit of unfunded tax cuts to spur growth. Sterling has dropped 5% since Thursday and 21% this year against a backdrop of an ever stronger dollar. As the pound fell on Monday, the dollar surged to new highs on the euro and many more. "Everyone's got this hope that the dollar is peaking and peaking and peaking, but it's just been far too premature," said Paul Mackel, global head of FX research at HSBC in Hong Kong. China's yuan also hit a 2-1/2 year low on Monday and was steady at 7.1639 on Tuesday.

☆ Pound rebounds as traders turn to BoE response
▼ + stars: | 2022-09-27 | by ( Tom Westbrook | ) www.reuters.com time to read: +3 min

As the dollar eased, the pound rose 1% in Asia to $1.0805 and is up nearly 5% from Monday's low at $1.0327. The kiwi also rose 1%, its first gain in seven sessions, the euro rose 0.5% and the Aussie rose 0.7%. "More BoE rate hikes could only briefly boost the pound but not on a sustainable basis," said Gao. As the pound fell on Monday, the dollar surged to new highs on the euro and many more. The Aussie and kiwi hit 2-1/2 year lows on Monday and were due for a rebound, with the Aussie up 0.6% to $0.6500 and the kiwi up 1.2% to $0.5703.

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