- MUFJ expect the Bank of Japan to end negative rates at its March meeting
- China's iron ore imports in January - February jumped up 8.1% y/y
- Heads up for more speeches from RBNZ Governor Orr and Chief Economist Conway
- China trade data: January- February yuan denominated exports +10.3% y/y
- Heads up for US President Biden to speak Thursday evening - inflation will feature
- Federal Reserve Chair Powell speaks again on Thursday. Mester is on deck also.
- Japan's largest industrial union says wage hikes won are bigger than last year
- BOJ board member Nakagawa says steady progress being made towards inflation target
- Reports some government officials are said to support a near-term Bank of Japan tightening
- PBOC sets USD/ CNY reference rate for today at 7.1002 (vs. estimate at 7.1898)
- Bank of Japan Governor Ueda to speak from 3.10pm Tokyo time
- More on Japan wages data: Real wages shrank in January for the 22nd consecutive month
- Australian January exports +1.6% m/m (prior +1.8%) & Imports +1.3% (prior +4.8%)
- Australian housing finance data for January: -4.6% m/m (prior -5.6%)
- More on Fed's Kashkari - sees possibility of only one Fed rate cut this year
- Japan January wages data show continued real falls
- European Central Bank meets Thursday - no rate cut expected
- Bank of Canada stands firm: No rate cut in sight
- Houthi terrorist missile that hit merchant vessel kills 3 sailors on board
- UBS wary of US Presidential election polling - warns of a potential Brexit-like surprise
- Forexlive Americas FX news wrap 6 Mar: Fed Chair comments keep easing on table. USD lower.
- Fed Kashkari says base case no more hikes, but higher for longer if inflation entrenched
- US House has voted to secure government funding through to September 30
- Trade ideas thread - Thursday, 7 March, insightful charts, technical analysis, ideas
The yen followed on from its gains on Wednesday by adding to them here today. USD/JPY is under 148.50 as I post and yen crosses are lower pretty much across the board.
USD/JPY dropped under 149.00 after wages data in Japan for January. The data showed good nominal wage gains, adding to the best wage rises in 2 decades. But, as for inflation-adjusted wages, when you mix in CPI at its highest for 30 years real wages fell again in the data today, for the 22nd consecutive month. The more optimistic take is that the drop was the slowest in over a year. As an aside, this is partly why the Shunto wage talks are critical for the BOJ in considering their policy options – to tighten or not. As a reminder, the next BoJ meeting is on March 18 and 19.
Following the small dip lower for USD/JPY we had a string of yen-bullish items cross the wires:
- There were reports that the Bank of Japan has approval from some government officials to end its negative interest rate policy in the near term
- BOJ board member Nakagawa said the Japanese economy was making steady progress towards achieving the Bank's 2% inflation target, a sign of her conviction that conditions for phasing out its massive stimulus were clicking into place
- Japan's largest industrial labour group said 25 of its member unions have so far had their wage demands met in full during annual wage talks that end next week. Full-time workers' pay is set to rise 6.7%.
As these items crossed USD/JPY fell further.
Still to come is Bank of Japan Governor Ueda speaking in parliament from 3.10 pm Tokyo time (0610 GMT, 0110 US Eastern time).
From China today we had January-February trade figures. China combined import and export data for January and February into one ‘YTD’ release to smooth out the impact of the Lunar New Year holidays, which fall in either January or February every year. Both imports and exports improved y/y. Chinese equities rose, as did ‘China proxy’ FX like AUD.
Federal Reserve Bank of Minneapolis President Neel Kashkari, in an interview with the Wall Street Journal, said he may change his forecast at the upcoming March 19 and 20 Federal Open Market Committee (FOMC) meeting from his December projection of two cuts in 2024 to only one. He says he has not yet decided.
AUD/JPY not as soft as other yen crosses with AUD catching a small bid from the Chinese data:
