Japanese Finance Minister Masako Kato confirmed that her team is closely coordinating with US Treasury Secretary Scott Bessent on monetary policy, indicating that the United States has tacitly approved Japan’s recent suspected market intervention.
“Regarding the recent currency movements, we confirm that Japan and the United States have been coordinating very well and maintaining close communication,” Katakura Taisuke told reporters in Tokyo after meeting with Bessette.
She said, “We also reaffirm that we will continue to cooperate closely on currency issues in accordance with the joint statement issued last September.” She added that the agreement clearly states that currency intervention is one of the options to address excessive volatility in the foreign exchange market. “I believe we have fully understood this point,” said Katayama.
Katahira declined to comment on whether the Bank of Japan’s monetary policy was discussed during the meeting. She also said she would not comment on Besant’s remarks.
Less than two weeks ago, Tokyo was suspected of having intervened on a large scale in the yen exchange rate for several consecutive days to prop up the yen. Bessenst had previously hinted that he was critical of direct market intervention and preferred the Bank of Japan to support the yen by tightening monetary policy.
The yen weakened after the press conference, suggesting that traders may have had higher expectations for the meeting’s outcome.
The Japanese authorities may have intervened in the market for the first time on April 30. This came after the Bank of Japan announced that it would maintain its monetary policy unchanged, while the hawkish stance of the Federal Reserve pushed the yen to break through the 160 mark against the US dollar. Bloomberg’s analysis of the Bank of Japan’s revised data indicates that Japan may have spent approximately 24.7 billion US dollars in this operation and an additional 30 billion US dollars in subsequent operations.
Data released earlier on Tuesday showed that Japan’s foreign exchange reserves at the end of April were roughly the same as the previous month, suggesting that any currency intervention may have occurred before the end of the month and thus was not reflected in the figures.
Technical analysis:
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Gold: The US-Iran agreement made no progress over the weekend, causing the price to open lower with a gap, but the extent was relatively limited. This is mainly because Trump will visit China in the second half of the week, which may bring changes to the situation. For today, we will continue to focus on low-sweeping liquidity and catching rebound signals. For detailed positions, please consult the plugin.
(Gold 15-minute chart)
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Nasdaq: After the price recaptured the 28,800 level, it accelerated its rise, leaving a potential demand zone at this level. Therefore, a green buy limit operation is set up for the day. Additionally, the liquidity hunting area is at the yellow position. If there is a rebound signal after the sweep, it can also be attempted first. For detailed positions, please consult the plugin.
(NASDAQ 15-minute chart)
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Crude oil: On Friday, the price was suppressed in the 95-97 range. However, over the weekend, as the agreement made no progress, the price rose back above 100. Today, we will continue to observe the selling opportunity during the pullback after the break. For detailed positions, please consult the plugin.
(Crude Oil 15-Minute Chart)
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Today’s key financial data and events to focus on:
20:30 US April Unadjusted CPI Year-on-Year Rate
