Each market is nervous ahead of tomorrow’s US consumer price index. Bond selling pressure is persistent as inflationary alerts spread. Yields on 10-year US Treasury bonds rose to 3.20% yesterday. However, after that, there was a scene where it decreased rapidly and fell below 3.00%. It is a restless market development.
The dollar-yen pair rose to the 131.35 level due to the ups and downs of the US bond yield, and then fell back to the 130-yen level today. European currencies such as the euro and the pound have also turned to selling dollars after buying dollars. Meanwhile, the Australian dollar, which is sensitive to risk trends, has been weak as US stocks have been sold since last weekend. The rebounding movement of the crude oil market is also a heavy factor.
The market reaction to tomorrow’s US consumer price index is divided. One view is that the market forecast is expected to slow down from the previous time, and inflation will peak out and the dollar buying will be adjusted. On the other hand, there is a view that inflation will continue to be at a high level even if the growth slows down a little, and the dollar buying pressure will reignite after adjustment due to the awareness of the US monetary authorities’ interest rate hike route.
In any case, the market attention is high. The dollar market has moved up and down in the foreseeable future, and the wait-and-see mood is likely to expand today. Yields on 10-year US Treasury bonds have risen above 3% again, and US stock futures have barely fallen.
The US dollar is a nervous development, but the US dollar buying perspective continues. Today, the Japanese yen has been strongly repurchased, probably due to the sharp drop in stock prices, so I chose to buy at USDCHF.