From Marc Chandler at Bannockburn Global Forex:
Overview: A 15 bp hike by the BOJ and plans to halve its bond purchases by the end of FY25 (in March 2026), coupled with a hawkish press conference by Governor Ueda sent the dollar to nearly JPY150, its lowest level in four months. A soft-core inflation reading in Australia send the Aussie lower and is the weakest of the G10 currencies. The others are little changed. The focus is now on the Federal Reserve, which is expected to signal that its confidence has grown that inflation is on its way back to the target and that it may be appropriate to reduce the restrictiveness soon. This will likely be understood as validating market expectations of a cut at the next meeting in September. A stronger endorsement by come at the Jackson Hole conference at the end of next month, when another employment and CPI report will be in hand.
Equities are rallying today. Nearly all the bourses in the Asia Pacific region but Taiwan rallied. China and Hong Kong were up by more than 2%. Australia's ASX advanced by 1.75%, while the Nikkei gained nearly 1.5%. The Stoxx 600 is up about 0.8% and US index futures are up around 1%. The 10-year JGB yield jumped 5.5 bp to 1.04%, while Australian 10-year yields tanked by 16 bp (to 4.11%). European yields are mostly 1-2 bp softer. The 10-year US Treasury yield is flat near 4.14%. Gold is firm and trading near a five-day high above $2420. It is the fourth consecutive session of higher lower. Escalating Middle East conflict, falling US inventories, and talk of a Saudi price increase have helped lift September WTI from the below $75 yesterday to near $77 today.
Asia Pacific....
....MUCH MORE
