The Japanese yen edged higher in Asian trading on Wednesday against a basket of major and minor currencies, attempting to recover after three consecutive sessions of losses against the US dollar. The move was supported by limited bargain buying, while the US currency remained under pressure ahead of the Federal Reserve’s monetary policy decision.

Dovish remarks from Bank of Japan Deputy Governor Shinichi Uchida helped ease market concerns about the pace of Japanese monetary tightening. Speaking at the post-meeting press conference on behalf of Governor Kazuo Ueda, who is currently hospitalized, Uchida delivered a less hawkish message than investors had expected, reducing the likelihood of another rate hike before December.

Price action

• USD/JPY slipped by less than 0.1% to 160.27 yen, from an opening level of 160.37 yen, after touching an intraday high of 160.44 yen.

• The yen closed Tuesday down by less than 0.1% against the dollar, marking its third consecutive daily decline, following Uchida’s comments.

US dollar

The US Dollar Index fell by less than 0.1% on Wednesday, extending losses for a third straight session as the greenback continued to weaken against a basket of global currencies.

The decline comes amid ongoing optimism surrounding a temporary peace agreement between the United States and Iran, which has improved risk sentiment and reduced demand for the dollar as a traditional safe-haven asset.

The current weakness in the US currency also precedes the outcome of the first Federal Reserve meeting under new Chair Kevin Warsh, with markets looking for any signals that interest rate cuts could be considered later this year.

Oil prices

Global oil prices fell by more than 1% on Wednesday, extending losses for a fourth consecutive session and hitting their lowest levels in three months as concerns about supply disruptions continued to ease.

US-Iran agreement

• President Donald Trump said he may submit details of the preliminary agreement with Iran to Congress.

• Switzerland’s Foreign Ministry said a potential memorandum of understanding between the United States and Iran is scheduled to be signed on June 19 in Bürgenstock, central Switzerland.

• The Wall Street Journal reported that the agreement would allow Tehran to resume oil sales immediately upon signing.

• Iran’s Foreign Minister said that after the initial phase, negotiations would continue for 60 days to reach a final agreement covering the nuclear issue and sanctions relief.

• A source told Reuters that the US-Iran agreement includes a $300 billion fund, with more than half already allocated for reconstruction projects in Iran.

• The fund contains no government money and remains separate from negotiations over frozen Iranian assets.

Japanese interest rates

• On Tuesday, the Bank of Japan raised its benchmark interest rate by 25 basis points to 1.0%, the highest level since 1995, marking another historic step in the normalization of monetary policy in the world’s fourth-largest economy.

• Deputy Governor Shinichi Uchida said the central bank will continue raising rates gradually in response to developments in economic activity and inflation, stressing that policymakers will not rush into aggressive tightening.

• Uchida added that it is currently difficult to determine the exact scale of future rate increases and that the bank will carefully assess incoming economic data before taking further action.

• Market pricing for a 25-basis-point rate hike at the July meeting dropped from 50% to 25%.

• Economic surveys indicate that the most likely scenario remains another 25-basis-point increase in December.

• Investors will continue to monitor inflation, employment, and wage data for further clues on the future path of Japanese monetary policy.

The Dow Jones Industrial Average reached a new record high on Tuesday, supported by falling oil prices and growing optimism over a potential peace agreement between the United States and Iran, while SpaceX extended its rally and surpassed Amazon in market value to become the fifth-largest US company.

SpaceX shares climbed about 9.5%, helping the Elon Musk-led company overtake Amazon in market capitalization.

The company also announced the acquisition of software firm Anysphere for $60 billion, a move aimed at strengthening its presence in the enterprise artificial intelligence market.

Memory-chip related stocks posted strong gains, with Western Digital rising 9% and Seagate Technology advancing 6%.

However, the technology sector within the S&P 500 slipped 0.5% after the sharp gains recorded in the previous session.

Seven of the eleven major sectors in the S&P 500 traded higher as investors rotated toward stocks more closely tied to economic activity.

Financial stocks led the gains, with the sector rising 1.1%.

Goldman Sachs advanced 1.3%, providing support to the Dow Jones, while JPMorgan gained 1.8% and Bank of America rose 1.2%.

Meanwhile, the energy sector fell 0.4% as oil prices hovered near their lowest levels in almost three months.

US stocks had rallied strongly in the previous session after President Donald Trump announced the signing of a preliminary agreement to end the conflict with Iran.

Despite that, uncertainty surrounding the deal remains, as shipping operators warned that restoring confidence in navigation through the Strait of Hormuz could take weeks even after its reopening.

Markets await the Federal Reserve decision

Investor attention is now focused on the Federal Reserve’s monetary policy decision due on Wednesday.

The US central bank is widely expected to keep interest rates unchanged within the 3.50%–3.75% range, while investors closely watch comments from Federal Reserve Chair Kevin Warsh regarding inflation, unemployment, and the economic outlook.

“All eyes are on Warsh’s press conference, guidance, and forecasts for the markets,” said Thomas Hayes, chairman of Great Hill Capital.

He added: “But with the US-Iran agreement appearing close to completion, that gives him more room to strike a balanced tone.”

Hayes also noted that markets often experience heightened volatility during the first year of a new Federal Reserve chair.

Inflation remains more than one percentage point above the Fed’s 2% target, making Warsh’s assessment of inflation trends and the timing of any moderation a key factor for future monetary policy.

According to the CME FedWatch Tool, traders currently assign a 42% probability to a 25-basis-point rate hike in December, while markets are not pricing in any rate cuts before mid-2027.

By 9:42 a.m. ET, the Dow Jones Industrial Average was up 360.77 points, or 0.70%, at 52,031.80. The S&P 500 gained 0.10% to 7,561.78, while the Nasdaq Composite rose 0.13% to 26,719.01.

The S&P 500 also moved closer to the record highs reached in early June following a previous pullback driven by concerns over elevated technology stock valuations and the US-Iran conflict.

Among individual stocks, Qualcomm gained 3.6% after a report indicated the company is in talks to acquire AI chipmaker Tenstorrent for between $8 billion and $10 billion.

Robinhood rose 1.1% after the trading platform announced plans to cut 10% of its full-time workforce and eliminate its remaining open positions.

Market breadth remained positive, with advancing stocks outnumbering decliners by a ratio of 2.19-to-1 on the New York Stock Exchange and 1.39-to-1 on Nasdaq.

The S&P 500 recorded 12 new 52-week highs and no new lows, while the Nasdaq Composite registered 46 new highs against 31 new lows.

Aluminum prices fell to their lowest levels in more than two months after the temporary agreement between the United States and Iran paved the way for the resumption of metal shipments through the Strait of Hormuz.

The widely used light-industrial metal dropped 4.4% to settle at $3,379.50 per metric ton on the London Metal Exchange, its lowest level since March 27.

Iran agreement

The United States and Iran have reached a preliminary agreement to reopen the Strait of Hormuz alongside the expected formal signing of the deal on Friday, although final details are still being negotiated.

The conflict with Iran caused significant disruptions to aluminum supplies after metal smelters across the Middle East were hit by missile attacks, while the closure of the strategic waterway disrupted inbound raw-material flows and outbound metal shipments to global markets.

Producers turned to alternative logistics solutions to keep operations running, but the conflict left the industry facing a substantial supply deficit.

“Aluminum prices appear vulnerable in the near term as supply risks fade while concerns over demand remain,” Bank of America analysts led by Michael Widmer said in a note.

They added that Middle Eastern production, which accounts for roughly 10% of global supply, declined 35% year-on-year in April, although part of that loss could be offset by higher output from China, the world’s largest aluminum producer.

Additional pressures on prices

The bank’s analysts also pointed to other bearish factors, including the potential release of Middle Eastern aluminum inventories if the Strait of Hormuz reopens, as well as rising supply from smelters in Indonesia.

US President Donald Trump said on Sunday that he was authorizing the reopening of the Strait of Hormuz “with no transit fees.”

However, Iran’s Fars News Agency, citing an informed source, reported that Iran would permit free passage through the strait for only 60 days.

Even so, shipowners said they need more details before assessing whether commercial navigation can safely resume, while some analysts believe the aluminum industry will continue to struggle to rebuild depleted inventories amid ongoing supply constraints.

China has increased exports since the conflict began, but producers are now facing government-imposed production caps.

Manufacturers have also been drawing down inventories held in exchange warehouses and private storage facilities, and those stockpiles are likely to continue declining as long as Middle Eastern flows remain constrained, according to Gregory Shearer, head of base and precious metals research at JPMorgan Chase.

“If the strait is reopened, we could see a sharp decline in prices because aluminum is closely tied to energy markets,” Shearer said.

“However, we still believe the market is facing a significant supply gap. The key question is how long it will take for invisible inventories to be exhausted before visible inventories begin to be drawn down,” he added.

Bitcoin recovered on Monday, climbing above $67,000 as investor sentiment improved and risk appetite strengthened across cryptocurrency markets following reports of a preliminary agreement between the United States and Iran.

The world's largest cryptocurrency rose 5% to trade above $67,000, recovering from sharp losses suffered over recent weeks as investors responded positively to signs that geopolitical tensions in the Middle East could ease.

The United States and Iran have reached a preliminary agreement that is expected to take effect on Friday.

US President Donald Trump said the agreement would include lifting the naval blockade on Iranian ports and reopening the Strait of Hormuz, one of the world’s most important energy-shipping routes.

The full text of the agreement has not yet been published.

Reports also indicated that the ceasefire agreement reached earlier this year would be extended for another 60 days, giving both sides more time to continue negotiations over Iran’s nuclear program.

At the same time, Iran’s Supreme National Security Council said the US naval blockade would be lifted immediately and that hostilities were expected to stop on several fronts, including Lebanon.

Strategy continues to increase its Bitcoin holdings

In a separate development, Strategy continued to expand its Bitcoin investments.

The company disclosed that it purchased around 1,587 Bitcoin between June 8 and June 14 for approximately $100 million, at an average purchase price of $63,024 per coin.

The purchases were funded through the sale of 1.73 million class A shares under its at-the-market equity offering program, generating net proceeds of about $209 million.

Following the latest purchase, Strategy’s total Bitcoin holdings rose to 846,842 coins.

The company said the total cost of these holdings was approximately $64.07 billion, with an average purchase price of $75,656 per Bitcoin.

Strategy also reported cash reserves of about $1.1 billion as of June 14.