Yen remains weak, dollar slips as markets await US CPI data
Updates as of 10:16 a.m. EDT
By Laura Matthews and Harry Robertson
NEW YORK/LONDON, Aug 13 (Reuters) -The yen remained weak for asecond straight dayon Tuesday and the dollar softened against the rest of its peers incalmer trading, as markets await U.S. inflation data that could indicate the outlook for Federal Reserve interest rate cuts.
The greenback began softening after the release of data showing U.S. producer pricesincreased less than expected in July as a rise in the cost of goods was tempered by cheaper services, indicating that inflation continued to moderate.
"We're seeing little bit of weakness, and part of the issue is we don't have a CPI (report) yet," said Erik Nelson, macro strategist, at Wells Fargo Securities in London. "We did see a little bit of dollar weakness. The core PPI number was actually kind of strong, which may be holding back the dollar weakness as well."
Currency markets have been rocked by a sharp rally in the yen since July that has prompted - and been driven by - an unwinding of a highly popular investment strategy called the carry trade and contributed to a slide in stocks.
Yet the dollar was softeragainst the yen JPY=EBS on Tuesday to 146.98, in a sign that markets appear to be over the worst of the recent turbulence.
The yen slid to 38-year lows in July as investors piled into the carry trade, where they borrow yen in Japan where interest rates are low, then sell it for other currencies to buy higher yielding assets elsewhere.
A number of factors, particularly a surprise rate hike by the Bank of Japan and expectations of U.S. rate cuts due to a slowing labor market, have combined to reverse the carry trade stampede, leaving the yen up around 8% since mid-July.
Government sources told Reuters that Japan's parliament plans to hold a special session on Aug. 23 to discuss the central bank's decision last month to raise rates.
Investors await the moreclosely watched consumer price index report on Wednesday, which will also helpguide the Fed's interest ratepolicy.
The dollar index =USD slipped to102.92, with the euro up EUR=EBS 0.22% at$1.0957.
"All told this is a fair indication that the Fed won't have any roadblocks to cutting interest rates at least 25 bps (basis points) in September," said Helen Given, associate director of trading at Monex USA.
"I still don't believe 50 (bps) is likely, as the Fed has shown itself to be averse to shocking the market, but the potential for any easing rather than continued holds promises some USD weakness especially as other central banks around the world consider holding rates steady during the next meeting cycle."
POUND PERKS UP
Sterling GBP=D3 rose0.42% to$1.2817, withdata earlier in the session showing the UK's jobless rate fell to 4.2% in June from 4.4% in May, defying economists' expectations of a slight rise. Job vacancies declined while wage growth slowed.
Low survey response rates have recently caused investors and economists to put less weight on Britain's labor market data.
In other currencies, the Aussie dollar AUD=D3 rose 0.35% to $0.6608. The dollar was flat against the Swiss franc CHF=EBS, another currency that has rallied recently as investors have unwound carry trades.
Volatility in currency markets hits a one-year high https://reut.rs/4cqLedZ
Reporting by Laura Matthews in New York and Harry Robertson in London; Additional reporting by Wayne Cole in Singapore; Editing by Sam Holmes, Sharon Singleton, Susan Fenton and Paul Simao
Activos relacionados
Últimas noticias
Descargo de responsabilidades: Cada una de las entidades de XM Group proporciona un servicio de solo ejecución y acceso a nuestra plataforma de trading online, permitiendo a una persona ver o usar el contenido disponible en o a través del sitio web, sin intención de cambiarlo ni ampliarlo. Dicho acceso y uso están sujetos en todo momento a: (i) Términos y Condiciones; (ii) Advertencias de riesgo; y (iii) Descargo completo de responsabilidades. Por lo tanto, dicho contenido se proporciona exclusivamente como información general. En particular, por favor tenga en cuenta que, los contenidos de nuestra plataforma de trading online no son ni solicitud ni una oferta para entrar a realizar transacciones en los mercados financieros. Operar en cualquier mercado financiero implica un nivel de riesgo significativo para su capital.
Todo el material publicado en nuestra plataforma de trading online tiene únicamente fines educativos/informativos y no contiene –y no debe considerarse que contenga– asesoramiento ni recomendaciones financieras, tributarias o de inversión, ni un registro de nuestros precios de trading, ni una oferta ni solicitud de transacción con instrumentos financieros ni promociones financieras no solicitadas.
Cualquier contenido de terceros, así como el contenido preparado por XM, como por ejemplo opiniones, noticias, investigaciones, análisis, precios, otras informaciones o enlaces a sitios de terceros que figuran en este sitio web se proporcionan “tal cual”, como comentarios generales del mercado y no constituyen un asesoramiento en materia de inversión. En la medida en que cualquier contenido se interprete como investigación de inversión, usted debe tener en cuenta y aceptar que dicho contenido no fue concebido ni elaborado de acuerdo con los requisitos legales diseñados para promover la independencia en materia de investigación de inversiones y, por tanto, se considera como una comunicación comercial en virtud de las leyes y regulaciones pertinentes. Por favor, asegúrese de haber leído y comprendido nuestro Aviso sobre investigación de inversión no independiente y advertencia de riesgo en relación con la información anterior, al que se puede acceder aquí.
