Forex

FRANKFURT (Reuters) - Euro zone inflation is falling towards 2% and geopolitical stress poses only moderate risks but the European Central Bank should still exercise caution in cutting interest rates beyond a first step in June, Dutch policymaker Klaas Knot told Nikkei.

The ECB has all but promised a rate cut for June 6 and policymakers are now debating how to proceed in subsequent months after oil prices rose and unexpectedly high inflation readings... (continue reading...)

Friday's jobs report may be more important than the Fed meeting for dollar, said analysts at ING.

"The dollar ultimately reconnected with higher yields on Friday, but a market now exploring the narrative of no easing by the Federal Reserve in 2024 should keep the door open for more dollar strength. This is a big week for FX. The Fed announces policy on Wednesday, there are some key US data releases (including payrolls on Friday), and we may have finally seen FX... (continue reading...)

The EUR/GBP will ultimately find a more stable upward path, said analysts at ING.

"Expect Bank of England rate expectations to be influenced primarily by the Fed and US data today, as domestic drivers will be quite scarce. The UK calendar includes only some lending figures for March, housing figures for April and the final PMI report, while BoE officials will not be able to comment on monetary policy as the pre-meeting quiet period starts," said Francesco Pesole, FX... (continue reading...)

It is likely that Japan has pulled the trigger on intervention in USD/JPY, according to analysts at ING.

"There are strong indications – but still no officiality – that Japanese authorities intervened in the FX market this morning. USD/JPY touched 160.0 at around 02.30am BST and immediately faced two drops: a smaller one to 159.40, and then at 05.00am BST initiated a big fall to 105.0 (nearly a -3% move). It is now trading around 1.4% off the lows, at 157.20," said... (continue reading...)

Investing.com-- The Japanese yen weakened further on Monday, seeing little relief after middling signals from the Bank of Japan and increased expectations of higher-for-longer U.S. interest rates put the currency close to levels last seen in 1986. 

The USDJPY pair- which pegs the number of yen required to buy one dollar, blew past the 160 level on after seeing what analysts described as a "flash crash" on Friday. Weakness in the yen came even with Japanese markets... (continue reading...)