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29/07/24
144
JPY Directionless After Strong Week
On Monday, the Japanese yen continued to show volatility but closed where it began over the last few sessions. USD/JPY traded at about 153.65, up 0.04% for the day in the European session. Last week was excellent for the yen and it surged 2.3% versus the US dollar.
With no US releases on the calendar today and only a minor release from Japan, there will not likely be much movement from the yen.
Although the Federal Reserve will meet later in the week the market buzz is about the meeting in September. The Fed’s meeting will conclude on Wednesday and although there have been some voices urging for a rate cut, it’s virtually certain that policymakers will keep the benchmark at between 5.25% and 5.50%.
Although markets have priced in a September rate cut for weeks things have this past Friday become interesting with the inflation release. The PCE Price index edged down from 2.6% in May to 2.5% y/y in June, as per expectations.
Core PCE stayed at 2.6%, slightly higher than the market consensus of 2.5%. The news was very positive monthly – the PCE Price index gained 0.1% and the core rate rose 0.2%. Personal income and spending also both eased in July.
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