In the overseas market yesterday, the dollar market fluctuated violently over the US consumer price index. When the year-on-year rate of + 7.5% exceeded the previous forecast and recorded the highest growth in about 40 years, the dollar buying strengthened along with the sharp rise in the yield of US bonds. However, after that, there was a scene where the dollar was rapidly pushed back toward the depreciation. The market was confused as US stocks fell sharply due to inflationary caution. In the afternoon, hawkish Fed President Bullard St. Louis said he would support a sharp 0.5% rate hike in March and a policy rate hike to 1% by July 1. There was a history of increasing dollar buying again.
In the Asian market where Tokyo is absent, the dollar / yen pair remained in the low 116 yen range. The euro / dollar pair was in the high 1.13 range, the pound / dollar pair was in the low 1.35 range, and the Australian dollar / dollar pair was in the low 0.71 range. Both are trading at a higher level than before the US consumer price index was released. In the financial markets, the US FOMC is moving to factor in seven rate hikes this year, further strengthening the sense of rising US interest rates.
Also, yesterday, it was announced that the Bank of Japan will carry out an unlimited 0.25% limit operation on 10-year JGBs on the 14th of the week. For the dollar-yen, the movement to widen the interest rate differential between Japan and the United States is likely to progress further.
Today, the University of Michigan Consumer Confidence Index / preliminary figures (February) will be announced, and there are few clues to US economic statistics. With adjustment pressure ahead of the weekend, I would like to check whether the dollar-yen pair will firmly maintain the 116-yen level while watching the trends in US stocks and bonds.
Until now, every time the dollar / yen pair rose, the 116-yen level has become a strong resistance. However, it seems that the number of large sell orders in the 116 yen range has decreased considerably from yesterday.
Today, there are intermittent sell orders lined up at 116.20-30, but beyond this, it is assumed that the price may jump because there are no such large sell orders.