The US dollar lost steam on Middle East de-escalation, while the Japanese Yen remains weak ahead of the upcoming BoJ policy meeting. Markets are closely watching the US CPI report for further signals on Federal Reserve policy.
Key Takeaways
- 1.The US dollar lost momentum amid de-escalation in Middle East military tensions.
- 2.The Bank of Japan is expected to raise interest rates to 1.00% at its June 16 meeting.
- 3.Market expectations for the Fed policy outlook are aligning with other major central banks due to hawkish rate hike pricing.
Table of Contents
- JPY remains weak in run up to BoJ policy meeting
- USD: Middle East risks & Fed policy outlook remains key for USD performance
- YIELD SPREADS MOVING BACK IN FAVOUR OF USD
- JPY: BoJ set to hike rates & pause JGB tapering from FY2027
- KEY RELEASES AND EVENTS
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Authors
Lee Hardman
Securities
DXYUSDJPY
Themes
Central Bank Policy DivergenceEnergy Price Shocks
Regions
Middle EastUnited StatesJapanIran