NY foreign exchange market = dollar rises to 158 yen level, Bank of Japan maintains status quo and US PCE is supported | Reuters

NEW YORK (Reuters) – On the New York foreign exchange market, the dollar rose to the 158 yen level, hitting a new 34-year high. In addition to expectations that the Bank of Japan would maintain its policy status quo, U.S. inflation indicators were largely in line with expectations, increasing expectations that the Federal Reserve would delay the start of interest rate cuts.

The Bank of Japan maintained its current policy at its monetary policy meeting. Governor Kazuo Ueda did not make any in-depth comments on the weak yen at a press conference, and the yen-selling trend became even stronger.See more

According to EBS, the dollar/yen pair rose 1.7% to 158.275 yen in late trading.

At one point, the dollar price plummeted to 154.97 yen, and there was widespread speculation that a “rate check” had been introduced, requiring financial institutions to provide rates on the assumption that they would intervene or intervene to buy the yen. In the market, it is believed that a strong sense of wariness of intervention among participants led to a temporary concentration of dollar selling.See more

The dollar/yen pair is on track to rise by 2% for the week, the biggest increase since mid-January.

The US personal consumption expenditure (PCE) price index for March announced on the 26th rose 0.3% from the previous month, in line with market expectations. The year-on-year increase was 2.7%, slightly higher than the expected 2.6% rise. The core PCE price index, which excludes volatile food and energy prices, rose 2.8% year-on-year and 0.3% month-on-month, the same growth rate as February.See more

Douglas Porter, chief economist at BMO, said that although the PCE price index did not show as much upside to inflation as had been feared, giving some sense of relief, “The Fed’s inflation indicator has been steadily increasing since the beginning of the year. It’s on the rise,” he said. “It’s unlikely to give the Fed any confidence that inflation is calming down,” he said.

According to CME FedWatch, the market’s probability of a rate cut in September due to PCE is 58%, down from 68% a week ago. The probability of a December interest rate cut is priced in at over 80%.

The dollar index against major currencies rose 0.3% to 105.93.

The euro/dollar exchange rate fell 0.2% to $1.0705. The stock is expected to rise 0.4% for the week, the highest growth rate since early March.

The euro/yen pair briefly hit a 16-year high of 168.85 yen. After that, the stock rose 1.1% to around 168.845 yen. The stock is expected to rise 2.5% on a weekly basis, marking the largest increase since mid-June last year.

GBP/USD fell 0.1% to $1.2501. This week it rose 1.1%. This is the biggest price increase since early March.

Markets are focusing on the US Federal Open Market Committee (FOMC) meeting next week.

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