- JOLTS job openings for August 9.61M versus 8.800M expected
- Japan senior MOF official asked about intervention: No comment
- New Zealand GDT price index +4.4%
- BOC's Vincent: Firms continue to expect price changes to remain larger and more frequent
- Fed's Bostic: Higher long-end rates matter if they slow growth too much, no sign yet
- Fed's Bostic: Fed still has a way to go to get inflation back to target
- Fed's Mester: Says she's likely to favor hike at next meeting if current situation holds
- IBD/TIPP economic optimism index 36.3 versus 41.6 expected
Markets:
- US 10-year yields up 11.7 bps to 4.80%
- WTI crude oil up 77-cents to $89.59
- Gold down $3 to $1824
- S&P 500 down 1.3%, Nasdaq down 1.9%
- JPY leads, AUD lags
The Japanese ministry of finance had their feet put to the fire on Tuesday after a strong JOLTS report led to a broad USD bid and further selloff in bonds. Before the report, USD/JPY was right below the 150.00 level so it wasn't a big surprise when it broke and that continued up to 150.16. That's when Japan deployed its firepower in a quick drop to 147.40.
The market now thinks it's seen the MOF's hand and there was some strong dip buying and a bounce to 149.33. In the past several hours, it's ticked lower to 148.80. I've included a chart below.
Even with the MOF buying US dollars, it didn't do much to stop the rally in the dollar as 10-year yields rose to a new cycle high. AUD/USD was beaten up in a fall to the lows of the year. Similarly, USD/CAD rose above the April/September highs to 1.3735 despite gains in oil and natural gas.
EUR/USD continued to sink as well, hitting 1.0449, though that pair held up much better than others.
Late in the day, the US House voted to oust speaker Kevin McCarthy, adding to the uncertainty in the market.
USD/JPY intervention chart:
