USD/JPY rocketed higher early on Fed push back. Governor Waller spoke in Sydney, Australia, with a slap for the market response to the coller CPI report out of the US last Thursday. His comments were along the lines of: "The market seems to have gotten way out in front" over one CPI report "We're going to need to see a continued run of this kind of behavior...before we really start to think about taking our foot off the brake." "Everybody should just take a deep breath, calm down. We’ve got a ways to go” And there is more detail in the posts above. USD/JPY jumped 100+ points, topping out ahead of 140 before reversing back down by around 100 points.

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From China we had weekend news on a further relaxation of COVID response policy. This was accompanied by news of further support to come for the beleaguered property sector. The combined effect of these twin news items was buying for Chinese stocks, property-related stocks especially. In FX, the onshore Chinese yuan was revalued by the People’s Bank of China at the reference rate setting today 1000+ points away from Friday’s mid-rate. This is the largest differential since 2005.

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In the crypto space news broke over the weekend of a mishap at another ‘exchange’. This time a US$400mn transfer was mishandled (according to an admission by the CEO). It happened in late October. The crypto complex came under selling pressure. Bitcoin, for example, dipped back under US$16K at one stage.

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Apart from the yen and yuan other major FX rates were more sedate. There were losses against the USD on Waller’s remarks, some retracements, and all for not a lot of net change on the session as a whole.

usdyen wrap 14 November 2022