The Bank of Japan wasn’t the only Asian central bank in focus today. The People’s Bank of China was also on the agenda but left its key lending rate unchanged, despite some expectations of a cut. Here’s a recap of the week for central banks so far:
- Fed’s September Rate Decision: 50bp Cut
- Powell’s Opening Remarks: We Are Committed to Keeping Our Economy Strong
- Powell: We concluded that cutting interest rates by 50 basis points was the right decision
- Bank of England leaves interest rate unchanged at 5.00% as expected
- China leaves key one-, five-year loan rates unchanged
- Bank of Japan keeps interest rates unchanged, as widely expected
The USD/JPY pair continues to slide slightly on the day, now at 142.27, down from a high of 142.93 in early Asian trade. But this is also partly due to Treasury yields falling again. The 2-year yield fell 3.4 basis points to 3.570% while the 10-year yield fell 2.3 basis points to 3.716%.
Moreover, major currencies remain in narrower ranges as the dollar recovers from its wounds after yesterday’s decline.
There is still time for traders to digest what the Fed might do in the coming months. Will they try to exploit the Fed again? Or will economic data prove the charts released on Wednesday correct?
This article was written by Justin Low on www.forexlive.com.
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