Major
FX rates traded in subdued ranges for the session here, waiting for
the US nonfarm payroll report the excuse du jour.
Despite
this there were three interesting points to come out of the session.
Two
of them were officials from the Federal Reserve speaking:
- Christopher
Waller, a member of the Federal Reserve Board of Governors - then
Federal Reserve Bank of Cleveland branch President Loretta Mester
Both
stuck to the mantra of further rate hikes to come from the Federal
Open Market Committee (FOMC) without pause in order to bring the US
inflation rate back towards its 2% target. Waller gave a nod to
data-dependence while Mester was more assertive, going as far as
ruling out any rate cuts right through 2023.
Also
today we had yen intervention remarks from Japanese Prime Minister
Kishida. USD/JPY was above 145 early in the session and spent much of
it straddling the figure. Wheeling out the PM to comment on the
currency is a step up from having the finance minister make
statements. Kishida hit intervention warning words in his script,
talking of:
- sharp
moves - one-sided
yen moves - speculative
FX moves
These
are clear warnings that actual yen-buying intervention is not too far
away (see the post above for links to further information on what to
watch for imminent yen buying by the Bank of Japan). Above 145.70 was
the trigger for yen buying last time around, we are not too far from
there. USD/JPY, like other major FX, has not had a wide range on the
session, its currently just under 145.00 as I update.
