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Yen readies to mark weekly profit on haven demand
The Japanese yen rose in Asian trade on Friday against a basket of major rivals, resuming gains against the US dollar and approaching a two-week high and a weekly profit on strong haven demand amid concerns about US financial stability.
Earlier Tokyo data showed inflation rose to a two-year peak, showcasing the inflationary pressures facing the Bank of Japan’s policymakers, and bolstering the odds of a Japanese rate hike in June.
The Price
The USD/JPY fell 0.% today to 143.44 yen per dollar, with a session-high at 144.07.
The yen lost 0.25% on Thursday against the greenback, snapping a seven-day winning streak, the longest since April 2021 on profit-taking away from a two-week high at 142.80.
Weekly Trades
The yen is up 1.5% so far this week against the dollar, on track for the first weekly profit in five weeks.
US Financial Stability
After Moody’s decision to cut the US credit rating last week, the investor focus turned to the massive US debt reaching $36 trillion, and to Trump’s new tax reform bill, which would add trillions to this burden.
Trump described the legislation as a “big beautiful bill”, and has already passed the House of Representatives and headed to the Senate where it’s expected to face months of discussions and changes.
Inflation
Earlier Japanese data showed consumer prices rose 3.5% in April, the highest pace since early y023, beating estimates of 3.4%, and up from 3.2% in March.
Following the data, the odds of a Japanese 0.25% interest rate hike in June rose from 30% to 40%.
Bank of Japan Deputy Governor Shinichi Uchida said the bank will continue to raise interest rates if the economy recovers from the negative impact of US tariffs, however he still cautioned that the economic outlook remains highly uncertain.
Now traders await important Japanese data on inflation, unemployment, and wages to gather more clues.
Ethereum surges over 5% despite mixed risk appetite
Ethereum rose on Thursday amid a mixed risk appetite as investors assess latest data and the vote process in Congress on Trump’s tax bill.
In a partisan vote on Thursday, the House of Representatives voted in favor of Trump’s bill to cut taxes and increase military spending.
The bill, which has now moved to the Senate, is expected to increase government debt by trillions of dollars and spike the deficit, in a time of increasing concerns about tariff-related inflation.
The budget office at Congress estimates the cost of the tax bill at $4 trillion.
US 30-year treasury yields are up to 5.1%, the highest since 2023.
US 10-year note yields traded at just below 4.6%, with higher long-term yields usually pressuring the economy and impacting interest rates across economic sectors.
Earlier US data showed unemployment claims fell last week to 227 thousand, below estimates of 230 thousand.
US combined PMI rose to 52.1 in May from 50.6 in April, which was a 19-month nadir.
US services PMI rose to 52.3 in May from 50.8, while the manufacturing PMI rose to 52.3 from 50.2.
Ethereum
Ethereum rose 5.6% as of 21:11 GMT on Coinmarketcap to $2646.7.
US dollar boosted by upbeat data
The US dollar rose against most major rivals on Thursday following strong data.
In a partisan vote on Thursday, the House of Representatives voted in favor of Trump’s bill to cut taxes and increase military spending.
The bill, which has now moved to the Senate, is expected to increase government debt by trillions of dollars and spike the deficit, in a time of increasing concerns about tariff-related inflation.
The budget office at Congress estimates the cost of the tax bill at $4 trillion.
US 30-year treasury yields are up to 5.1%, the highest since 2023.
US 10-year note yields traded at just below 4.6%, with higher long-term yields usually pressuring the economy and impacting interest rates across economic sectors.
Earlier US data showed unemployment claims fell last week to 227 thousand, below estimates of 230 thousand.
US combined PMI rose to 52.1 in May from 50.6 in April, which was a 19-month nadir.
US services PMI rose to 52.3 in May from 50.8, while the manufacturing PMI rose to 52.3 from 50.2.
Otherwise, the dollar index rose 0.4% as of 19:44 GMT to 99.9, with a session-high at 100.1, and a low at 99.4.
Loonie
The Canadian dollar fell 0.1% against its US counterpart as of 20:00 GMT to $0.7211.
Sterling
The pound rose 0.1% on the dollar today to $1.3424.
Earlier UK data showed the manufacturing PMI shrank to 45.1 this month from 45.5 in April, while analysts expected 46.2.
The UK services PMI rose to 50.2 in May from 49 in April, while analysts expected 50.
Gold declines as dollar strengthens following data
Gold prices fell on Thursday as the dollar rose against most major rivals following important data.
In a partisan vote on Thursday, the House of Representatives voted in favor of Trump’s bill to cut taxes and increase military spending.
The bill, which has now moved to the Senate, is expected to increase government debt by trillions of dollars and spike the deficit, in a time of increasing concerns about tariff-related inflation.
The budget office at Congress estimates the cost of the tax bill at $4 trillion.
US 30-year treasury yields are up to 5.1%, the highest since 2023.
US 10-year note yields traded at just below 4.6%, with higher long-term yields usually pressuring the economy and impacting interest rates across economic sectors.
Earlier US data showed unemployment claims fell last week to 227 thousand, below estimates of 230 thousand.
US combined PMI rose to 52.1 in May from 50.6 in April, which was a 19-month nadir.
US services PMI rose to 52.3 in May from 50.8, while the manufacturing PMI rose to 52.3 from 50.2.
Otherwise, the dollar index rose 0.4% as of 19:44 GMT to 99.9, with a session-high at 100.1, and a low at 99.4.
On trading, gold spot prices fell 0.6% as of 19:45 GMT to $3294.5 an ounce.