It was a day of strength again for the US dollar, with yen a notable loser. As I post USD/JPY has hit a high just short of 152.00 and to its highest since 1990.

We had comments from Bank of Japan policy board member Tamura, who signalled he is in favour of continued, albeit slow and careful, tightening of policy. Financial media describe Tamura as a hawk. Which is laughable. At the Bank of Japan there are doves and slightly less dovish doves. Tamura is in the ‘slightly less’ camp. We also had comments from Bank of Japan Governor Ueda, who was speaking from parliament. Neither of these two had anything to say on the weak yen. Nothing at all. And, we didn’t hear from Kanda or Suzuki today with verbal intervention. BTD in yen crosses remains the play.

ADDED … Prior to posting this we have had a comment from Japan’s finance minister Suzuki in which he said he

  • won't rule out any steps including "decisive steps" to respond to disorderly FX moves

This is a ramping higher of rhetoric (but, yes, its still just words) from Suzuki and its given yen crosses a shake lower.


From Australia today were monthly CPI data for February. The headline came in slightly under expectations but at 3.4% y/y still well above the top of the Reserve Bank of Australia target band (which is 2 to 3%). Underlying rates of inflation were higher than this.

On the other hand, two things:

  • the recent annualised rates (2.2% in the last 6 months, for example) are improving notably
  • while the monthly trimmed mean inflation rate ticked up to 3.9% y/y, this was due to a base effect; trimmed mean m/m was a small negative

These are encouraging data.

AUD/USD fell away a few points on the data. Other FX also weakened against the USD; NZD, EUR, GBP, CAD but it was AUD hit more so out of this lot.

From New Zealand was the government’s Budget Policy Statement. GDP forecasts were revised down. The combination in NZ of discretionary fiscal policy changes (tax cuts) and a weaker economic outlook means NZDM’s bond issuance guidance is likely to increase.

From China, data showed industrial profits reached a 25-month high of 10.2% y/y YTD in the first two months of 2024.

usdyen suzuki 27 March 2024  2