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September 17th news: On September 17th local time, Krasnodar Airport in southern Russia received the first flight since its suspension of operations. This is also the first time the airport has resumed formal operations since its closure since the outbreak of the Russia-Ukraine conflict in February 2022.The number of rate cuts this year is expected to increase. 1. JPMorgan Chase: The updated dot plot indicates room for three rate cuts this year, one more than the June dot plot. 2. Deutsche Bank: The updated dot plot median may indicate a total of 75 basis points of rate cuts in 2025, 25 basis points more than the June forecast. 3. Barclays: The dot plot indicates three rate cuts this year, one each in 2026 and 2027, while the median long-term rate forecast remains unchanged at 3.0%. 4. Bank of Montreal: The median rate forecast for the end of 2025 is expected to be lowered to reflect the possibility of 25 basis point cuts at both the October and December meetings. The dot plot remains unchanged from June. 1. Pepperstone: The Federal Reserve is likely to disappoint market expectations. The dot plot median is likely to remain unchanged, still indicating only a cumulative rate cut of 50 basis points this year. 2. UBS: The dot plot will show two rate cuts this year, while the market expects closer to three. Participants economic outlook forecasts will also be in focus. 3. Bank of America: With macroeconomic forecasts largely unchanged, the median Fed rate forecast for 2025 will continue to indicate a 50 basis point cut, despite a downward shift in the overall dot plot. 4. Goldman Sachs: We expect the updated dot plot to show two rate cuts this year, to 3.875%. While the Fed may currently be planning three consecutive rate cuts this year, it may decide that forcing this into the dot plot is unnecessary. 5. Morgan Stanley: We expect the median dot plot to still show two rate cuts this year, but actual economic data may push the Fed to continue cutting rates throughout the rest of the year, extending this round of cuts into January. Other Views: 1. Citigroup: The updated dot plot is likely to indicate two to three rate cuts this year, and the median rate forecast for 2026 may also be revised downward.The UKs core CPI monthly rate in August was 0.3%, in line with expectations and the previous value of 0.2%.The UKs core retail price index was 4.4% year-on-year in August, compared with 4.70% in the previous month.The UKs retail price index rose by 0.4% in August, in line with expectations of 0.5% and the previous reading of 0.40%.

USDJPY seeks to reclaim 146.00 amid rising interest rates and US midterm election concerns

Alina Haynes

Nov 09, 2022 18:56

截屏2022-11-09 下午4.17.02.png 

 

In Asia on Wednesday morning, the USDJPY rises considerably from a two-week low at 145.70-80. Consequently, the Yen pair reverses its three-day decline in response to the cautious market sentiment.

 

Despite this, optimism is dwindling as the most recent information from the US midterm elections indicates government gridlock. In conjunction with the Republican demand for an increase in the debt ceiling, this intensifies the fear of rising interest rates.

 

The deteriorating coronavirus situation in China contributes to both the current risk aversion and the USDJPY exchange rate. China reports the highest number of new COVID cases in six months on November 8, with 8,335 new cases reported, while Guangzhou's second district remains quarantined.

 

It should be noted that Japan recorded a significant Current Account surplus for the month of September, but failed to recognize the sharpest decline in the surprise for the first half of the current fiscal year (FY) since 2008. In recent days, speculations of intervention by the Bank of Japan (BOJ) and the recent softening of US data joined mixed Fed fears to boost US Treasury rates and USDJPY prices.

 

As a result of these factors, the yield on the 10-year US Treasury note regains upward momentum and surpasses 4.14 percent, while the yield on the 2-year note climbs somewhat and approaches 4.62 percent. It should be noted that despite Wall Street's three-day rally, US stock futures reported minor losses while Asia-Pacific markets closed in the red.

 

Ahead of Thursday's release of the US Consumer Price Index (CPI) for October, USDJPY traders may find political and covid updates entertaining. Purchasers of USDJPY near 145.50 are protected by the 50-day simple moving average, but the recovery requires confirmation from a three-week-old resistance line near 147.45.

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