The yen continued to strengthen, reaching around 153 yen per dollar, the best performance among G10 countries, after markets increased expectations that the Bank of Japan would raise interest rates next week.
On September 8, 2569, at 09.27:6 AM, Bloomberg News reported that the Japanese yen continued to strengthen on Tuesday (September 8), reaching its highest level since February, or its strongest level in about six months, amid growing expectations that the Bank of Japan (BOJ) will raise interest rates at its meeting next week. Meanwhile, gains in South Korean semiconductor stocks boosted Asian stock markets.
The yen strengthened by as much as 0.8% to 153.16 yen per dollar, after surging 1.2% on Monday, and is currently trading around 152.98 yen per dollar, up about 0.9%.
The latest appreciation reflects that the upward momentum of the yen, which began after the joint market intervention by U.S. Treasury Secretary Scott Basecent and Japanese Finance Minister Satsuki Katayama, may be gaining momentum on its own. The yen has appreciated by approximately 4.3% since the beginning of September and has become the best-performing currency among G10 currencies.
In Asian stock markets, the MSCI Asia Pacific index rose 0.2%, with South Korean stocks outperforming the region. The Kospi index jumped 1.4% driven by buying in semiconductor stocks, particularly SK Hynix and Samsung Electronics, while Nasdaq 100 futures gained 0.3%.
However, Asian stock markets did not all rise at the same time. Japan's Topix index fell 0.5%, Australia's stock market fell 0.5%, and Hong Kong's Hang Seng index fell 0.5%, while China's Shanghai Composite index rose 0.3%.
Oil prices continued their upward trend from Monday, trading near $97 per barrel, as investors watched for details of the agreement between Iran and Oman on managing shipping through the Strait of Hormuz, coupled with strong buying from China which tightened supply in the market.
Brent crude oil, the global benchmark, has risen a total of 1.6% over the past two days, while West Texas Intermediate (WTI) crude is currently up 1.1% to $92.46 per barrel.
High energy prices are fueling concerns about inflation and leading investors to assess the possibility that central banks around the world may need to implement tighter monetary policies.
Anastasia Amoroso, head of investment strategy at Partners Group, said that global stock markets may be entering a consolidation or sway phase to digest the recent rally, as the world faces significant central bank policy shifts.
She believes that central banks around the world are currently in a tight monetary policy mode, which may cause stock markets to regain some gains, or at least enter a consolidation phase after their earlier gains.
A key factor supporting the yen is the increased expectation that the Bank of Japan (BOJ) will raise interest rates at its meeting next week, following recent Japanese economic data supporting a continued tightening of monetary policy.
The Japanese government revealed on Tuesday that the Japanese economy expanded faster than initial estimates in the second quarter, while wages in July rose to their largest level in nearly 30 years, further strengthening the likelihood of the Bank of Japan raising interest rates.
Katayama stated that Japan's position on the foreign exchange market has not changed since the time Japan intervened in the market jointly with the United States, and that the authorities will continue to take measures to maintain order in the market.
She also stated that she would continue to maintain close contact with Bescent, following the two countries' cooperation in addressing recent currency volatility.
Besides the BOJ, investors are also watching the policy direction of the U.S. Federal Reserve (Fed), as rising energy prices are raising concerns that inflationary pressures may increase again.
The United States is scheduled to release several key economic data points this week, culminating in an inflation report on Friday, which could be crucial in determining whether the Fed raises interest rates or keeps them unchanged.
The Bloomberg Dollar Spot index fell by about 0.2%, while the yield on 10-year U.S. Treasury bonds remained stable around 4.77%.
Meanwhile, the yield on 10-year Japanese government bonds fell 4 basis points to 2.890%, and the yield on 10-year Australian bonds fell 2 basis points to 5.17%.
Gold prices rose as the dollar weakened, making gold, which is denominated in dollars, cheaper for holders of other currencies. Spot gold prices increased by about 0.6% to $4,428.94 per ounce.
Copper prices on the London Metal Exchange surged to a record high on Monday, continuing weeks of gains amid expectations that President Donald Trump will expand U.S. tariffs to include more refined metals.
In addition to U.S. economic data, markets are also watching the earnings reports of major technology companies. Oracle and Adobe are scheduled to report their results on Thursday, which will provide the latest picture of spending on AI infrastructure, as well as the impact of AI on the software business.
Strategists at JPMorgan Chase, led by Mislav Matejka, stated that the earnings of listed companies are still on an upward trend. Therefore, if share prices weaken, it will make the stocks more attractive, and investors should take advantage of market corrections to increase their investments.
For digital assets, Bitcoin rose 0.3% to around $79,451, while Ether increased 0.5% to around $2,506.
Reference: bloomberg.com
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