• Japan’s PM commits to supporting the economy
• Receding odds of a third Japanese rate hike this year

The yen fell in Asian trade on Thursday against a basket of major rivals, extending losses for the second day against the US dollar and plumbing six-week lows after remarks by the new Japanese PM Shigeru Ishiba on supporting the world’s third largest economy, which in turn reduced the odds of a third Japanese interest rate hike this year.

The yen is also pressured by higher US 10-year treasury yields before important US labor data on Friday.

The Price

The USD/JPY rose 0.55% to 147.24 yen per dollar, with a session-low at 146.28.

The yen lost over 2% on Wednesday against the dollar, marking the second loss in three days, and the largest since June 17, 2022 after bearish remarks from the new Japanese PM.

Ishiba

After a meeting with Bank of Japan Governor Kazuo Ueda, the new PM Shigeru Ishiba said that current economic conditions don’t support another interest rate hike.

Shigeru however did assert that  the BOJ will make its decisions independently on monetary policies.

Japanese Rates

Investors now see little chance of a Japanese interest rate hike in October, and a small chance as well of a hike in December.

US Treasury Yields

US 10-year treasury yields rose 0.4% on Thursday, extending the gains for another session and boosting the greenback against main rivals.

The developments came after strong US private sector employment data in September, which showcases the flexibility of the US labor sector.

According to the Fedwatch tool, the odds of a 0.5% November interest rate cut by the Federal Reserve dipped further to 34%, while the odds of a 0.25% rate cut rose to 66%.

Now investors await the all important US payrolls report tomorrow to gather more clues.

Oil prices gained ground on Wednesday but reduced the gains after US inventory data, which showed an unexpected buildup last week.

The Energy Information Administration reported a buildup of 3.9 million barrels in US crude stocks last week to a total of 416.9 million barrels, while analysts expected a drop of 1.5 million barrels. 

Gasoline stocks rose 1.1 million barrels to 221.2 million barrels, while distillate stocks fell by 1.3 million barrels to 121.6 million barrels. 

Israel said that Iran launched over 180 ballistic missiles at its territory, with Iran’s Revolutionary Forces saying the attack is a response to Israel’s assassination of Ismael Heniyeh and Hassan Nasrallah.

There were no reports of injuries in Israel, and it comes after a similar Iranian attack in April that didn’t leave a lasting damage or impact on the financial markets.

On trading, Brent December futures rose 0.45%, or 34 cents to $73.90 a barrel.

US crude futures due in November rose 0.4%, or 27 cents to $70.10 a barrel.

Most cryptocurrencies fell on Wednesday as the risk appetite kept waning, while investors headed for safe havens amid mounting geopolitical tensions in the Middle East. 

Israel said that Iran launched over 180 ballistic missiles at its territory, with Iran’s Revolutionary Forces saying the attack is a response to Israel’s assassination of Ismael Heniyeh and Hassan Nasrallah.

There were no reports of injuries in Israel, and it comes after a similar Iranian attack in April that didn’t leave a lasting damage or impact on the financial markets.

Otherwise, earlier US data showed the private sector added 143 thousand new jobs in September, above expectations of 128 thousand, and up from 103 thousand in August. 

According to the Fedwatch tool, the odds of a 0.5% Fed interest rate cut in November stood at just 36%, with a 64% chance of a 0.25% rate cut. 

Ethereum 

On trading, ethereum fell 1.5% as of 17:37 GMT to $2440.4. 

Most US stock indices inched down on Wednesday as the markets assess the latest developments in the Middle East.

Israel said that Iran launched over 180 ballistic missiles at its territory, with Iran’s Revolutionary Forces saying the attack is a response to Israel’s assassination of Ismael Heniyeh and Hassan Nasrallah.

There were no reports of injuries in Israel, and it comes after a similar Iranian attack in April that didn’t leave a lasting damage or impact on the financial markets.

Otherwise, earlier US data showed the private sector added 143 thousand new jobs in September, above expectations of 128 thousand, and up from 103 thousand in August. 

According to the Fedwatch tool, the odds of a 0.5% Fed interest rate cut in November stood at just 36%, with a 64% chance of a 0.25% rate cut. 

On trading, Dow Jones fell 0.1%, or 36 points to 42120 points as of 16:14 GMT, while S&P 500 fell 0.1%, or 8 points to 5700, as NASDAQ was little changed at 17,909.