According to Japanese media citing a group interview, US Treasury Secretary Scott Bessent said that if the Bank of Japan continues to implement the correct monetary policy, the yen will stabilize at an appropriate level.
According to Kyodo News and Nikkei, Bessenet refused to comment on the yen’s exchange rate. This month, the yen has depreciated against the US dollar at least twice as fast as other major currencies, hitting an eight-month low of 153.27 yen to the dollar on October 10. The fading speculation of the Bank of Japan’s recent interest rate hike is a key factor in the yen’s depreciation against the US dollar.
According to the Nikkei, Bessenyei refused to comment on the next policy decision of Bank of Japan Governor Katsuyoshi Okada on October 30. It was reported that the governor merely said that Okada was highly capable.
Bessenst’s recent remarks on the Bank of Japan were much milder than his tone in August, when he said that the Bank of Japan was lagging behind in dealing with inflation. This statement once again reminds people of Washington’s stance on currency issues, as President Donald Trump has occasionally accused Japan of enhancing its trade competitive edge by devaluing its currency.
The instability of Japan’s political situation is the main reason for the reduction in the number of economists expecting the Bank of Japan to tighten policy this month. According to overnight swap market prices, as of Thursday, traders expect the possibility of the Bank of Japan raising interest rates to be about 15%, compared with about 70% at the end of last month.
Earlier this month, Harumi Kato, who unexpectedly won the Liberal Democratic Party’s presidential election, is more likely to secure the parliamentary votes needed to become the next prime minister. After the Komeito Party withdrew from the ruling coalition last week, Kato has stepped up efforts to win the support of other opposition parties. It is expected that the parliament will elect a new prime minister next week.
Technical analysis:
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Gold: The momentum break in the blue area yesterday had a relatively significant buying effect. Additionally, the yellow area for liquidity sweep was just a little short of achieving entry. For today, continue to maintain a relatively active buying arrangement. For buy limit, pay attention to around 4220. After the liquidity sweep, the buying focus is on the 4190/4200 area. For detailed positions, please consult the plugin.
(Gold 15-minute chart)
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Nasdaq: Yesterday, the blue break and pullback buy signal from our plugin was effective for a while. However, the price continued to drop to 24,488, clearing out the liquidity at the previous low. Today, we will continue to focus on short-term buying opportunities. Pay attention to pullback buys after breaking through 24,800, as well as buying after the range between 24,400 and 24,500 is swept. For detailed positions, please consult the plugin.
(NASDAQ 15-minute chart)
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Crude oil: After the price rose and then fell back yesterday, the blue area failed to take over, and the strategy of buying on the pullback failed. However, after sweeping the liquidity again, the price began to stabilize and rise. Pay close attention to the key resistance at around 59 within the day. If it can be recaptured, a long position should still be attempted within the day. For detailed positions, please consult the plugin.
(Crude Oil 15-Minute Chart)
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Today’s key economic data and events to focus on:
20:30 U.S. Seasonally Adjusted Initial Jobless Claims (in thousands) (to 1011)
20:30 U.S. Producer Price Index for September (year-on-year)
20:30 US September Retail Sales (MoM)
20:30 US Philadelphia Fed Manufacturing Index for October
At 21:00, Fed Governor Waller will deliver a speech.
