The USD / JPY pair touched it’s highest level in 24 years. It was happened inline with the dollar weakening and increasing obligation yield in America so far.
Besides that, Bank of Japan is still with it’s decision to maintain the low interest rate. The world central bank is now paying attention to many things. One of them is the difference between BOJ and the other banks.
That is related to the different interest rate that they have. The world central Bank itself always recommend that a higher interest rate is always needed.
To the US Dollar, Yen was closed around the level of 136.657. Before, this Japanese currency has been touching 136.702. Based on a data, That was the highest achievement since October of 1998.
The Weakening Trend will be Continued
The analysts explained that this declining trend will be still continued. It means that the trend won’t stop in a short term period. The Japanese Yen has been weakening due to the increasing fuel price.
A significant different between the Japan’s government obligation yield and United States treasury is also the cause. BOJ somehow still wants to maintain their decision.
Last week, that institution decided to maintain it’s really low interest rate decision. Besides that, they also want to maintain that policy. In the other words, they won’t change it.
Based on a data, a policy like this is effective to handle the Japan’s government obligation yield result. Thar sector is stoll around the position of 0.25 percent in the market.
BOJ Breaks Many People Predictions
Before, most of the market participants made a prediction about the further action that may be taken by Bank of Japan. They thought that BOJ will change it’s monetary policy.
If these things occured, the shaken situations may be happened in the obligation market. However, this step must be able to trigger the Yen strengthening and made the obligation result.
However, it is interesting since BOj then decided for not doing this thing. Today, market will highlight the statements which will be delivered by Jerome Powell as the leader of Federal Reserve.
The speech is going to do in two sessions in a row. That will be done in two days in front of the congress. Market is going to search any clues whether the interest rate will be increased by 75 BP or not.
Thomas Barkin in a moment said that the possibility is 50 – 75 basis point in July. This number is quite reasonable and maybe the institution will do that.
Elsewhere, Oil Price Slumped
The crude oil price also slumped where that was happened at the beginning of yesterday trading. It is especially amidst the push from Joe Biden as the president of America.
He wants the whole oil producers, especially the giant companies in that country to low down the fuel of price at least in the peak of demand. That is usually occured in Summer.
In line with the effort to handle the rocketinh fuel price and inflation , Biden may also consider to delete the federal tax for fuel temporarily. The amount is around 18.4 cent dollar.
7 Companies Will Meet Joe Biden
Based on a schedule, seven enterprises will meet Joe Biden tomorrow. They come under a pressure from white House to press the fuel price. It is because those companies have been made many profits from the high prices happened before.
The Chevron Chief Executive replied that critizsed these companies due to the profits they got Is not the right way to make fuel prices are cheaper. These criticisms don’t have any benefits.
Although there is a concern of inflation, The demands of this commodity is still possible to up. It is especially to a level before COVID-19. Meanwhile, the stocks are maybe not enough to fulfill that demand.