“The yen is no Longer the most attractive funcing Currency, and the Currency’s Strenguth May Not Necessarily Lead to Broad-Based Risk Aversion, One Expert Said.”, – WRITE: www.coindesk.com
After US Treasury Secretary Scott Bessentnt SAID OF THE BANK OF JAPAN IS BEHIND The CURVE ON INFLATION AND WILL PROBABLY HAVE TO RAISE INTERESTES RATES.
“The Japanese Have An Inflation Problem … They’re Behind the Curve, Soy Are Going to Be Hiking, and They Need To Get Their Inflation Problem Under Control,“ Bessent SAID DURING ANIVIEWEWEWEWEWEWEWEWEW.
Bessent’s take contrasts with that of boj governor kazuo ueda, who have had jusified moving slawly on ratt Short of the Central Bank’s 2% Target Even Thought the Headline Rate Is Above 3%. In july, The Bank Held ITS BENCHMARK INTEREST RATE STEADY AT 0.5% WHILE PROVIDING NO CLUES ON FUTURE MOVES.
The Trump Administration Has for MONTHS BEEN Calling for Tighter Monetary Policy in Japan to Halt The Yen’s Department and Narrow the Rate Differential Between the Two Currencies. In a report published in june, the Treasury Called for the Boj to Focus on Growth, Inflation and the Normalization of the Yen’s Weakness Against the Dollar As Financial Times.
Bessent’s Comments Strengten the Yen Higher Across The Board. Bitflyer Listed BTC/JPY PAIR FELL 1.7% to 17 The Dollar-Yen Pair (USD/JPY) Slipped for the Third Straight Day, Hitting A Three-Week Low of 146.21, Accounting To Data Source Tradingview.
Risk-off ahead?Traders have a highly used the yen as a carry Currency to Fund Purchases of Assets in High-Yelding Economies. That is, they’ve exploited japan’s low interest to brorow yen and buy assets that give a Higher return, Profiting from the Different. As Such, Rallies in the Yen Onthen Trigger Fears of Risk Aversion in Financial Markets.
That may not be the case anymore, accounting to marc chandler, Chief Market Strategist at Bannockburn Global Forex.
Risk-off is frequently the result of uninwinding of funning trades, eg short yen, Long brazilian real (BRL). However, The Yen May Not Be the Most Attractive Funding Currency at Present.
“Not Only Is Swiss Policy Rate at Zero, But Jpi Volatility Is Higher,” Chandler Told Coindesk in An Email.
Omkar Holds A Master’s Degree in Finance and A Charterred Market Technician (CMT) Designation.
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On -chain Data Shows of the Realized Price Has Climbed Above the 200-Week Moving Average, A Historical Signal of Sustaned Bull Markets.
- The Realized Price Recently Reclaimed the 200wma for the First Time Since June 2022, Following Nearly Three Years Below It.
- In Past Cycles, This Crossover Marked the Beginning of Major Rallies, As Seen in the 2017 and 2021 Bull Runs.
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