The Forex News thread

[Kauri]

The dramatic plunge in JGB prices that forced a temporary trading halt has put pressure on the EUR/JPY. JGB futures have fallen over 2 points in one of the biggest one-day moves in over a decade. The sharp rise in Japanese yields is putting some pressure on the EUR/JPY.. maybe??

Cheers
..........Kauri

The big story for Japan was the highest inflation results in 10 years which prompted a huge JGB sell-off with two Japanese banks said to be among the large sellers. The rise in JGB yields has actually seen the US-JGB spread narrow today, which may also help cap USD/JPY ahead of 105.00 .. Also a goodly amount of oppie defence around the 105 figure... and a block or three of Japanese exporter offers around the same level....

Cheers
............Kauri

The USD/JPY is shuffling at 104.40,s with DJIA futures firm and up 70 pts odd so far. The CPI data out of Japan has smacked the market overnight with further strong price pressures to emerge in coming months that will encourage Japan rate hike speculation and increases the risk to carry trades. Wheat prices were hiked last September for the first time in 24 years and the flour price rise is only feeding through now with the Nikkei reporting that millers are expected to hike prices by 10-20% this month. Kirin Beverages reports ingredients now cost 40% more and a survey by the Nikkei Shimbun this month says that 76% of major food firms are looking at price hikes. Ramen noodle prices rose last Sept for the first time in 17 years, with utility rates for July & Sept already tipped for the 4th straight quarterly rise in Japan. Milk prices and Meiji Dairies were hiked in February for the first time in 30 years and soy sauce prices are on the rise. And Japan, along with the rest of the world, suffers from higher gas prices that are hurting consumer spending.

Cheers
............Kauri