The US dollar is getting a broad bid at the moment but the biggest move is in USD/JPY, which has just broke the May high of 131.35.
One of the catalysts today is the bond market. US 10-year yields began to march higher at the start of New York trade and are up 5.9 bps to 3.01%. It's the first trip above 3% since a brief foray in mid-May.
The Bank of Japan is the final holdout on any kind of pivot away from ultra-loose monetary policy, though you wouldn't know it from an op-ed in today's WSJ by a pair of economics professors from Johns Hopkins.
"We don’t have a global inflation problem. Inflations are always and everywhere a monetary phenomenon spawned by the creation of excess money by local central banks. China, Japan and Switzerland also face elevated oil prices, supply-chain problems and fallout from the war in Ukraine, but their annual inflation rates are 2.1%, 2.5% and 2.5%, respectively. They have avoided the ravages of inflation because their central banks haven’t produced excessive quantities of money."
That's quite the argument given the enormous -- by any standards -- balance sheet at the Bank of Japan.
In terms of technicals, the 2002 high in 2002 is just above 135.00.
