Marketwatch North America

Daily Insights
March 27, 2024

The USD/JPY reached a multi-decade high overnight at 151.971 (highest since July 1990) in a test of wills between speculators and the Bank of Japan. In response to the yen weakness, Japan’s Finance Minister said the BoJ was ‘watching market moves with a high sense of urgency’, a not-so-subtle threat of direct intervention. The last time the BoJ intervened on behalf of the JPY (by selling USD to artificially prop up the JPY) was in 2022 when USD/JPY reached 151.94. Three months later the USD/JPY had reached a low of 127.21, a 16.28% decline for the dollar. The rising stakes in defending the JPY, and the potential volatility in JPY crosses is a magnet for FX traders who have been enduring historic low volatility in the foreign exchange markets.

USD/JPY has retreated to 151.34 on the BoJ comments, but dollar bulls will almost certainly mount another offense against the JPY and force direct action from Japan’s central bank.

The dollar has gained vs. 9/10 of the G10 currencies today, lifting the U.S. Dollar Index by 0.14% to 104.44. Primary gains for the dollar are +0.42% vs. SEK and +0.39% vs. NOK. The dollar’s single gain is vs. the JPY, +0.15%.

U.S. Treasury yields are lower by inconsequential margins with traders on hold ahead of upcoming inflation data (tomorrow’s Core PCE Price Index and Friday’s Personal Income/Spending and PCE Deflators).

Oil prices are lower today with WTI Crude -0.62% at $81.11/barrel (partially explains SEK and NOK weakness). Gold is making a move, +0.58% today at $2,191.18. A daily close above $2,185.96 will be a new all-time record.

Economic Calendar

USD - Crude Oil Inventories
AUD - CPI y/y
CHF - Gov Board Member Schlegel Speaks
EUR - Spanish Flash CPI y/y
USD - FOMC Member Waller Speaks
CHF - Credit Suisse Economic Expectations
JPY - BOJ Summary of Opinions
EUR - Italian 10-y Bond Auction
GBP - FPC Meeting Minutes
GBP - FPC Statement
CNY - CB Leading Index m/m
CHF - SNB Quarterly Bulletin

Market Indicators

Currency Pairs
Pair High Low
usd/jpy 151.968 151.025
eur/usd 1.0839 1.08149
gbp/usd 1.26384 1.26077
aud/usd 0.65382 0.65111
usd/cad 1.36081 1.3582
eur/gbp 0.85852 0.857
usd/mxn 16.6744 16.5785
Equities and Commodities
S&P 500 5240.96
NASDAQ 18358.7
DOW 39509.7
GOLD 2186.82
SILVER 24.46

This document is for information purposes only and does not constitute any recommendation or solicitation to any person to enter into any transaction or adopt any trading strategy, nor does it constitute any prediction of likely future movements in exchange rates or prices or any representation that any such future movements will not exceed those shown on any illustration. All exchange rates and figures appearing are for illustrative purposes only. You are advised to make your own independent judgment with respect to any matter contained herein.