That's one theory on what the Fed was worried about yesterday
Liquidity usually means US-dollar liquidity. The rally in USD/JPY is counter-intuitive and it's extremely powerful right now.
Yen/dollar 3-month FX basis swap spreads have widened to 109.5 basis points, which is the largest gap since December 2016.
You have to wonder what's going on behind the scenes. In USD/JPY, I highlighted the 61.8% retracement at 108.00 earlier. That's an important level. Last at 107.61.
