The Bank of Japan announced an unscheduled bond-buying operation that caused the yen to briefly rise during the Tokyo session.
➡️ A few hours ago, the Bank of Japan launched an unscheduled bond-buying operation aimed at reducing recent increases in Japanese sovereign yields. This had the effect of causing a short-term spike in the Japanese yen, with the reference currency pair USD/JPY which reached ¥148.75 before just as quickly returning to its recent price action area just below ¥149.80. It appears that the price of this currency pair may attract intervention from the Bank of Japan whenever it approaches ¥150.00, and even then the price is not far from this big round number.
➡️ The war in the Middle East remains contained for now. President Biden will arrive in Israel soon and other Western heads of state will also visit, although Arab leaders have canceled their scheduled meetings with Biden. Most markets consolidated over the last day, trading sideways.
➡️ Precious metal prices continued to rise strongly, with They which just hit a nearly 2-month high in USD terms.
➡️ Trend traders in the Forex market will be more interested in having a long position on USD/JPY, which has continued to strengthen. In the short term, the Australian dollar is the strongest major currency, while the US dollar is the weakest.
➡️ US retail sales data released yesterday was stronger than expected, suggesting the economy is not cooling due to rate hikes as quickly as expected. This could support the dollar if it gives weight to the need for further rate hikes.
➡️ Canadian CPI (inflation) data released yesterday was lower than expected, showing an annualized rate of only 4.4% when 4.8% had been forecast.
➡️ UK Consumer Price Index (Inflation) and Australian Unemployment data will be released today.
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