[Japan Market Conditions] Yen rises, Governor Ueda maintains mitigation and adjustment stance - bond exchange rate falls

August 23, 2024 15:34 JST
If the basic stance does not change, Governor Ueda will expand the CPI in a positive range for 3 consecutive months
Governor Ueda's response “I took it in a slightly hawkish way” - Invesco AM Kinoshita
The yen exchange rate rose against the dollar in the Japanese market on the 23rd. Bank of Japan Governor Ueda Kazuo maintained an attitude of adjusting monetary easing, and yen was bought and bond prices fell (long-term interest rates rose).

The appreciation of the yen progressed in response to Governor Ueda's response to the Diet. In response to statements that there is no change in the basic stance of adjusting the degree of monetary easing if the accuracy of economic/price forecasts increases, purchases anticipating a reduction in interest rate differences between Japan and the US took precedence. The positive range of the July National Consumer Price Index (core CPI), which was announced earlier, expanded for 3 consecutive months, and exceeded the Bank of Japan target of 2% for 28 consecutive months. Long-term interest rates rose, and stock prices continued to grow.
　　US Federal Reserve (FRB) Chairman Powell's keynote speech is ahead at 11:00 p.m., following CPI and Governor Ueda's answers. The market was watching closely to see if it would send signals about the timing, scale, and pace of interest rate cuts, and it became a deterring factor. In the US market on the 22nd, stocks fell from the view that Chairman Powell would not suggest aggressive interest rate cuts by the end of the year, and interest rates were rising.