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Up next: US data
July PPI
Weekly jobless claims
Neither will change expectations of a Sept rate cut but it pays to be aware of consensus forecasts in case of a miss/beat.
Markets should be more sensitive to a downside miss (lower PPI, higher claims) than an upside beat.
See our Economic Data Calendar
This was the trigger for the UsDJPY tumble overnight. Similar to WH pressure on the Fed, this makes the BoJ’s job harder as a rate hike might be seen as being driven by pressure from the US.
Another way to look at it is that Bessent is calling for a weaker USDJPY by calling for a narrowing of the interest rate gap between the US and Japan
Bessent Says BOJ Is Falling Behind the Curve, Expects Hike
(Bloomberg) — US Treasury Secretary Scott Bessent said the Bank of Japan is falling behind the curve in addressing inflation, in a rare comment admonishing policy decisions by a foreign central bank.
“They’re behind the curve,” Bessent told Bloomberg TV on Wednesday, noting that that was his opinion, and that he discussed inflation in Japan with BOJ Governor Kazuo Ueda. “So they’re going to be hiking and they need to get their inflation problem under control,” he added.
USDJPY DAILY CHART
EURGBP
EURGBP extended its slide to test key 8596 support, which has so far checked the downside (void below to 8507)
On the upside, back above 8620 would be needed to cool the risk, back above 8635 to shift focus to 8659
Note: A weaker EURGBP has been a weight on EURUSD while helping to give GBPUSD a bid so watch how it trades vs 8596
EURGBP DAILY CHART
For those who missed it, see below
Savvy Trader’s USDJPY Update – Key Levels and EURJPY Timing Signal
USDJPY has been a trader’s paradise for a year but the next big move may be down.
Here’s why the Savvy Trader is selling rallies with an initial target of 143.20 and watching EURJPY for the timing cue.
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